Hoteliers are coming to the corporate rate negotiation table in a position of greater strength than in years past, although they still expect increases at the low end of industry projections. Most sources interviewed for a HotelNewsNow reported pegged corporate rate increases for 2016 in the 3% to 5% range.
That’s below the 6.5% to 7.5% range forecasted - the largest in three decades - by Bjorn Hanson, clinical professor at the Tisch Center for Hospitality and Tourism at the NYU School of Professional Studies. It’s also shy of the 5.2% increase predicted for the U.S. hotel industry on average, according to STR, parent company of Hotel News Now.
“In most areas, business travel is on the rise, and on peak business travel nights demand is more than supply, resulting in hotels being able to increase rates for 2016. Our plan is to reward loyal clients with the lower percentage increase to keep them from looking for a new preferred hotel,” said Lori Kiel, VP of sales and revenue management at The Kessler Collection.
She was among those expecting corporate rate increases between 3% and 5%, along with her peers at the Banyan Investment Group and Waramaug Hospitality.
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