Hotel room demand is strong and rising, and non-hotel competitors are not eroding demand from the all-important business traveler. Below are a few confirming excerpts from a recent article by Nancy Marshall-Genzer in NPR’s Marketplace (August 18, 2015):
Life is sweet if you’re a hotel chain right now. While there’s a shortage of hotel rooms in the U.S., demand is up, so hotels can charge more. The shortage is a leftover from the recession, when hotel construction plummeted. It’s still not up to pre-recession levels.
But won’t demand for hotel rooms fall because of competition from upstarts like the sharing service Airbnb? Not according to Smedes Rose, a senior analyst at Citigroup. He says the all-important business traveler is sticking with hotels.
“They’re not really flocking to Airbnb,” he says. “Partly because there’s a convenience factor for hotels. There’s probably a liability factor — travel policies that companies have in place.”
Hotels are also diversifying, with different brands catering to specific travelers. Surprise, surprise! The latest trend is hotels for millennials.
Those feature “larger square footage for the lobby and the bar area,” says Lauro Ferroni, head of hotel research at JLL, a commercial real estate service firm. “Of course, everything is wired.”