Hotel rates likely will continue to rise in most locations globally during 2024 despite an expected softening of leisure travel demand, according to new forecasts from the consulting team at American Express Global Business Travel (Amex GBT). The Hotel Monitor 2024 finds that rates could rise by as much as 17.5% in some cities, where tight supply combined with local conditions push the average cost of a room upwards.
Amex GBT’s Hotel Monitor 2024 forecasts hotel price trends in more than 80 major cities based on analysis of millions of hotel transactions and International Monetary Fund (IMF) economic data. Some predictions for top business travel destinations include Chicago (up 12.6%), New York (up 6.8%), San Francisco (up 6.2%), Paris (up 11%), London (up 9.1%), Berlin (up 9.4%), Bengaluru, India (up 11.1%), Sydney (up 4.9%), Shanghai (up 8.4%) and Singapore (up 7.5%).
Most cities should experience rate increases in line with local inflation, following the large price jumps in 2022 and 2023 fueled by a surge of so-called “revenge tourism.” Softening leisure travel demand should be replaced by the continued uptick in business travel, and meetings and events.
Simon Fishman, vice president, global hotel, said that with the softening of leisure travel demand, GBT and its corporate customers have an improved position at the negotiating table, meaning the company can make even more rates available to travelers.
It’s also the right time to make sure a hotel program is fit for the future, said Fishman. More than ever, he said, it’s about presenting travelers with relevant and personalized options. One might want the best rate, while another will prioritize amenities and experience.
