Hospitality Insights - 2nd Half
Travel Has Returned
U.S. hotel demand is quickly approaching pre-pandemic levels with revenue projected to reach 11% above 2019 levels at $188.4 billion this year.1 U.S. hotel occupancy rose to 68% for the week ending October 8 with an average daily rate (ADR) of $153.79 and revenue per available room (RevPAR) at $104.83.2
Shift in the Type of Traveler
While business travel is slow to return, the bleisure traveler is on the rise with business and leisure travel continuing to blur. There is also a shift in how the new traveler is traveling: Micro-Cation, which are long weekend stays, normally less than 4 nights. Millennials are leading the way in micro-cation trips often looking at the hotel’s amenities. And 90% of consumers are looking for sustainable options when traveling,3 which can provide opportunities for creative foodservice disposables and grab-n-go options.
Rising Prices Affect Hotel Operating Costs
Inflation pressures, labor shortages, and high energy costs are having a significant impact throughout the industry, with hotel wages increasing nearly 18% from 2019 to April 20221. Hotels still face staff shortages which provides opportunities for training, more efficient solutions, and product innovations to help offset the labor challenges.
1.“Return of Travel, AHLA’s 2022 Midyear State of the Hotel Industry Report”, AHLA in Collaboration with Accenture, July 2022
2.“STR: U.S. Hotel results for week ending 8 October”, STR, October 13, 2022
3.“Sustainable Travel Study”, Expedia Group Media Solutions, April 2022