Geopolitical factors along with global, regional and local economics are creating a complex landscape for corporate travel buyers when negotiating hotel rates in key business destinations, according to a new report.
The Hotel Monitor 2019, published by American Express Global Business Travel (GBT), includes a pricing forecast for 150 cities around the world, as well as a white paper on accommodations programme optimisation.
A key finding of the research shows traveller security and political unrest are expected to be catalysts for significant rate fluctuations globally. Meanwhile, demand for more security-compliant properties is growing, particularly in upscale hotels. Global policy changes, such as Brexit and updates to the NAFTA trade agreement, are also expected to impact trade and travel activities.
Emerging markets experiencing economic growth – such as those in the Asia Pacific region – have already seen hotel rates increase and will continue to see rises. The report also predicts moderate price increases in Latin America.
Available inventory and limited supply growth in Europe is facing steady demand, driving up rates in many destinations. On the other hand, over-supply and other factors are pushing prices down in some Gulf states in the Middle East. Meanwhile, North American hoteliers are reporting increases in bookings and revenues, partly driven by strong growth in business travel and groups. As a result, rates are predicted to rise across the continent.
Joakim Johansson, vice president of business development at American Express GBT, commented: “As we enter hotel RFP season, overarching global and market tendencies will play a critical role in the operational and financial success of travel programmes. Reviewing how others have adapted to changing business conditions provides an important opportunity to identify best strategies and ensure time and resources are utilised in the most cost-efficient way possible.”
The Hotel Monitor 2019 is the first in a series of analyses, with future editions looking at air and ground transportation due out later this year and early 2019.