Both domestically and internationally, many properties managed by major hotel companies are reeling from an unanticipated drop in demand that began in late summer and abruptly accelerated with the economic crisis on Wall Street.

A top executive with an international luxury hotel chain, who did not want his name used for fear of losing his job, told me recently that the dominoes are falling among full-service hotels frequented by business travelers in London, Tokyo, Hong Kong, Shanghai, Paris and even New York. Until recently, hotel rates in New York were buoyed by robust demand by financial services executives and by foreigners lured by a favorable exchange rate.

The good news, at least for corporate travel managers, is that for the first time in many years, they have negotiating power as they put together contracts for next year.

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