InterContinental Hotels Group, the owner of hotel chains like Holiday Inn and Crowne Plaza, announced on Tuesday that it had a profitable year in 2023. The company reported increased earnings per room and for the first time, its profits exceeded $1 billion.
Many hotels experienced a significant recovery in 2023, however, questions are being raised about whether the post-lockdown surge in travel and accommodation has reached its peak. The initial years of the pandemic were harsh for the hotel industry, but according to Steven Carvell from Cornell’s School of Hotel Administration, 2023 was an exceptional year.
Carvell stated that the strong economy benefited hotels across various markets including major cities like New York City, Boston, Miami, as well as destination resorts, smaller cities, and upscale and luxury hotels. Despite this, hotel occupancy was still lower than pre-pandemic levels due to a lag in business travel.
Suzanne Neufang from the Global Business Travel Association highlighted that hotels generally follow the trend of business travel. She noted that an increasing number of companies are sending employees on business trips and 66% of those who manage travel for their companies expect their company’s business travel expenditure to increase this year.
Leisure travel has been a major factor in the hotel industry’s recovery so far. However, Kaushik Vardharajan from Boston University’s School of Hospitality Administration noted a slight decline in leisure travel in 2023 and expects this trend to continue in 2024, at least for domestic travel within the U.S.
Vardharajan anticipates a different scenario for international tourists, especially with China lifting its foreign travel restrictions. He expects a significant increase in leisure demand from international destinations.
Source: marketplace.org