The CEOs check in panel during NYU IHIIC , from left : Moderator and CNBC anchor Sara Eisen ; Sébastien Bazin , president and CEO , Accor ; Tony Capuano , president and CEO , Marriott International ; Mark Hoplamazian , president and CEO , Hyatt Hotels Corp .; Elie Maalouf , president and CEO , IHG Hotels & Resorts ; and Chris Nassetta , president and CEO , Hilton .
By DAVID EISEN
Hotel company CEOs are some of the most pollyannaish folk in business . The biggest cheerleaders of travel and hospitality have a duty to tell it like they think it is — even if it ’ s not . Leave the honesty to the hotel developers and lenders .
Never mind that transient lodging demand has declined for four straight quarters and that STR adjusted down its U . S . hotel forecast to 2 % RevPAR growth in 2024 and 2.6 % in 2025 , according to Elie Maalouf , president and CEO of IHG Hotels & Resorts , “ The best days are still ahead for this industry .”
It ’ s in their best interest to sound assured : a vote of no confidence is never good for business . The hotel industry , like others , is cyclical — things go well , things sour some — and as Maalouf pointed out , “ If you ’ re an investor , if you ’ re an operator , you will always have those higher highs and higher lows ,” but patience is the attribute best to deal with it .
Some of the problems facing the hotel industry are readily apparent . Part of the reason STR adjusted its forecast down is due to the stubborn inflation that is keeping gas and groceries still high . It ’ s especially hit harder on the lower-income group consumers , which has and will result in that cohort foregoing travel in some cases , a circumstance that will negatively impact lower-tier hotels . STR now predicts that year-over-year RevPAR will decrease by 3 % in 2024 for the economy hotel segment . “ The upscale through luxury tier is seeing healthy demand , but pricing power has waned , given changes in mix and travel patterns and to a lesser extent , economic conditions . Travel remains a priority for most Americans , but the volume has lessened as prices on goods and services continue to rise ,” said Amanda Hite , president of STR .
STR ’ s conclusion is shared by Chris Nassetta , president and CEO of Hilton , who said that the hotel industry on whole still had good pricing power , primarily because of the near-zero growth in new supply . However , “ It ’ s not one size fits all ,” he said . “ There are consumers at the lower spectrum of the economy that are tapped out a bit and demand is a little bit more challenging .” He contrasted that against the upper-middle and the upper-end of the socioeconomic spectrum , where “ there ’ s still a lot of demand because people have a lot of money in their bank accounts and still want experiences .”
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