The capital markets panel, from left: Jeffrey Horwitz, Proskauer; Michael Bluhm, managing director, global head of real estate, gaming and lodging, Jefferies; Emily Feeney, VP of capital markets, Noble Investment Group; and Jeff Stulmaker, partner / CIO, KHP Capital Partners. |
|||
|
so-called K-shaped economy proves to be holding up with the affluent continuing to spend heavily on travel.“ There is no price resistance at the high end.” CoStar forecasts luxury RevPAR to be up 5.3 % YOY in 2026.
In recent days, hoteliers say they are recognizing a thaw in travel toward the center of the chain scales, a sentiment shared by Freitag.“ There is widespread demand growth for the middle of the chain scales, a reversal from last year,” he said.
An Expense Vice Some are a bit more leery, especially hotel owners who continue to be squeezed by line-item expenses that have made it challenging to record monthly profits. Last year was particularly tough: Gross operating profit per available room, or GOPPAR, was negative in 2025, according to CoStar, but it should swing back
|
to positive in 2026, if CoStar is right.“ The level of flow through has helped margins,” offered Michael Grove, CEO of HotStats, a profitability benchmarking firm.“ F & B has been strong, as has conference and events, wellness and golf. Guest spend on property has offset some costs.”
The benchmarkers aren’ t the only ones sanguine over the prospects of travel and hospitality, including hotel owners and operators, but they still see warning signs flashing.“ We came into the year with momentum after a Q4 pick up in deal volumes,” said Emily Feenet, VP of capital markets and transactions for Noble Investment Group.“ There was positivity around 2026. Then ICE, then war in the Middle East. There is a lot of noise in the macro.”
As Michael Bluhm, managing director, global head of real
|
estate, gaming and lodging at Jefferies, sees it, capital continues to chase the sector.“ The drive for experiences has never been bigger. Capital formation continues around the space.” He cited recent examples of M & A, including Tilman Fertitta’ s nearly $ 30-billion bid to acquire Caesars Entertainment in cash and assumption of debt, and Barry Diller’ s $ 18-billion play for MGM Resorts.“ There is a momentum shift around capital and willingness to take risk. These are big bets,” he said.
CEO Cheer Travel momentum carrying through 2026 was supposed to reach apogee during FIFA World Cup, but as the AHLA recently wrote, World Cup demand has not materialized into strong hotel bookings: Eighty percent of hoteliers across all 11 U. S. host cities
|
report bookings below initial forecasts, with visa barriers and geopolitical concerns suppressing international demand in 65-70 % of markets. Block cancellations and rising costs are also identified as key drivers of softened demand.
Not even a red card can sap the enthusiasm and optimism out of a hotel company CEO.“ We are in a good mood,” declared Chris Nassetta, president & CEO of Hilton. He, too, referenced the K-shape economy as a driver of travel success, but over the last several weeks, Nassetta has been championing what he calls the C-shaped economy, or a convergence economy, where mid- and lower-tier hotels make a comeback on the backs of those segments’ cohort travelers.“ It is shifting,” he said, a trend that began in Q4 of last year and has carried over, driven by a business-friendly
|
July / August 2026 hotelsmag. com 9 |