Convention Calendars Fill Up in Most Markets
While there's several headwinds that hoteliers are pushing against, there's also a handful of tailwinds that are giving them hope for 2023.
Green shoots this year include the continued increase in group business production and the easing of some supply-chain disruption, according to hoteliers.
Hotel News Now asked industry experts to share what they feel are the biggest currents propelling them forward in 2023.
David Wani, CEO, Twenty Four Seven Hotels
"The corporate demand, group demand is certainly starting to return on a more meaningful basis. In the third quarter , we started to see it coming back ... we certainly see that going into . Maybe some markets might still have that hesitance from COVID [to have] meetings and conventions, but for the most part, we're now seeing that convention calendars are really starting to fill up in the markets that we have convention centers."
"Another positive, certainly, is the supply-chain issues seem to have dissipated for the most part. Very rarely do we come across where something is back ordered. First part of 2022, [we] were waiting 90 to 120 days just to get sheets. Now, [we] could put in an order on Monday, if [we] wanted to pay the additional freight, and it should be there by Friday."
"We anticipate by the end of the first quarter  that [food costs] will be back to a normal level."
Richard Jones, Executive Vice President and Chief Operating Officer, Hospitality Ventures Management Group
"I think, based on what we're experiencing and hopefully as an industry, we've learned to be a little more disciplined around holding rate and not being so quick to discount. I think we're probably in a pretty supportable, sustainable place in terms of hotel rates. Where the risk is going to come back ... I think we've reset the bar back to the historical norm of supply-driven factors that will dilute a particular market or competitive set. We were just doing a budget review last week and there was a whole lot of new supply that was delivered over the course of 2020, 2021 and 2022. There's not going to be a whole lot of growth in 2023; not because of demand, the demand is very healthy, but supply has outpaced demand.
"I think the bar has been reset. Price points and rate expectations, where they are now, is the new normal. What we'll just have to do is deal with supply impacts on the market and how hotels price."
Gilbert Arredondo, Divisional Vice President of Revenue Strategy, Remington Hotels
"One thing we see, most metrics support this, group bookings [are] coming back. We really haven't seen group bookings slow down, especially for Q1 . We're still really in a short-term group booking environment, for the most part. That's really our tailwind."
"Second ... we continue to spend more [on marketing and public relations]. You've got to be in front of your consumer today. There's so much information coming out all at once. Having a robust marketing [team] that can really get to the consumer, they actually open the email, they watch your ad, is really key."
David Loeb, Owner of Dirigo Consulting
"The tailwinds we'll be seeing is people want to get out and travel. Work from home is creating more opportunities for bleisure. I think those trends will continue, that will keep lengths of stay pretty long. [And] I think rate discipline will continue."
"So far, in most industries, there's still a labor shortage, and its hard to get people to fill jobs. [As] that happens, companies are more likely to [use travel as an incentive]. If they want to keep people, they'll let them go to trade shows, conventions and conferences."
Copyright 2023 CoStar Group. All rights reserved. From https://www.costar.com. By Dana Miller, Hotel News Now.