Global Hotel Rates Expected to Rise Moderately in 2025
According to the Amex Global Business Travel Hotel Monitor 2025 report, global hotel rates are projected to rise in 2025, although the increases are expected to be more moderate compared to recent years. The report analyzes the hotel economy in 80 cities worldwide and forecasts a shift in the market dynamics with an easing of leisure travel demand and a significant surge in new hotel construction.
With over 2,700 new hotels anticipated to open globally in 2025, the supply of hotel rooms is set to increase. This influx is expected to help stabilize prices, despite ongoing challenges. The report notes that global inflation is projected to decrease from 5.9 percent to 4.5 percent, contributing to the easing of hotel rate increases. However, rates will remain elevated due to persistent cost pressures, particularly related to labor and operational expenses.
“Hotels continue to be squeezed by higher-than-inflation costs for key inputs, including labor,” stated Sara Andell, Director of Strategy at Amex GBT Consulting. She emphasized that while leisure demand has historically pushed rates upward, signs of abatement are emerging. The record levels of hotel construction are also increasing the availability of rooms, which could further moderate price growth.
Some cities and regions are expected to experience significant rate hikes. New York City is predicted to see a 4.7 percent increase, making it one of the highest in North America. In Europe, cities in the Nordic countries are expected to witness similar rate growth, with Istanbul projected to have the highest increase at 9.2 percent. Additionally, India is anticipated to experience the most substantial rate increases in Asia.
“Stabilization in the travel marketplace is good news for customers, but prices remain high, and challenges persist for companies managing cost-effective corporate hotel programs,” said Dan Beauchamp, Vice President of Consulting at Amex GBT. He noted the importance of data-driven decision-making and effective communication for smarter hotel sourcing. Travel buyers can enhance their strategies by negotiating multiple room types, considering dynamic rates, and utilizing negotiated rate programs from travel management companies (TMCs) to improve coverage in secondary and tertiary cities.
As the hotel landscape evolves, these insights will be crucial for both leisure and business travelers navigating the changing pricing environment.
Related News: https://airguide.info/?s=Global+Hotel