According to the April 2022 edition of CBRE Hotels’ U.S. Hotels State of the Union, the hotel industry recovery continues despite downward pressure on economic growth.
Key takeaways:
- Consumers are feeling the pinch of rising inflation and hotels are grappling with increased labor costs and supply chain issues.
- Since the pandemic, hotel wages are growing at twice the rate of the U.S. overall and 43% faster than hourly retail wages.
- March trends continued to improve across all chainscales, and April weekly data suggests these gains have held.
- Brand.com and OTAs have taken share from group and GDS booking channels as leisure demand has driven the recovery. However, group and business travel are improving, rising to 11.0% and 6.9% of demand share, up from 10.1% and 6.0% at the end of 2021, respectively.
- Hotel-specific leading indicators show no signs of deterioration. However, macroeconomic leading indicators suggest there could be challenges ahead.
- International travelers have returned from most of the top 10 markets except South Korea, China and Japan. East Coast gateway markets continue to strengthen. However, West Coast, Asia-dependent markets continue to lag.
- Operating revenues have nearly recovered to prior peak levels. However, the reopening of lower margins amenities and inflationary pressures have caused gross operating profits to lag.