What are the hotel expectations for 2023?

Average hotel occupancy is expected to reach 63.8% in 2023 – just shy of 2019's 65.9%. Staffing is expected to remain a significant challenge for U.S. hotels in 2023, with hotels projected to employ 2.09 million people in 2023, down from 2.35 million in 2019.



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We are lowering our 2023 RevPAR growth forecast from 6.0% to 4.6% owing to a weaker-than-expected Q2 2023. Early indicators of property distress are increasing. Profit declines are contributing to an uptick in delinquencies, from 5.4% to 5.9%. This could be a precursor to increases in special servicing down the road.

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Supply and demand imbalances aside, hotels are facing other challenges this year thanks in large part to persistently high inflation. “Hotels are faced with rising energy costs to heat and cool along with the rising cost of goods and services,” Hayley Berg, lead economist at Hopper, tells Money.

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Future hotels will be customizable 34.4% want to use their own devices for access throughout the hotel. 25.4% said they were interested in room controls that auto-adjust temperature, lighting and even digital art, based on their preferences.

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If you thought 2022 was an expensive year to travel, get ready to spend even more in 2023. New data from travel site Hopper shows that U.S. hotel prices averaged $212 per night in January — that's 54% higher than the same month in 2022. Planning on taking a trip soon?

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Revenue in the Hotels market is projected to reach US$106.10bn in 2023. Revenue is expected to show an annual growth rate (CAGR 2023-2027) of 3.32%, resulting in a projected market volume of US$120.90bn by 2027. In the Hotels market, the number of users is expected to amount to 160.60m users by 2027.

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The global luxury hotel market size was valued at USD 128.54 billion in 2022 and is anticipated to grow from USD 140.28 billion in 2023 to USD 293.61 billion by 2030, exhibiting a CAGR of 11.1% growth during the forecast period of (2023-2030).

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“We are going to continue to see room rates grow just below the level of inflation,” Freitag predicts—an expectation he and other experts say could continue even if the economy does enter a recession. Still, hotel rates are undeniably elevated right now.

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The problem now is that charming, cheap hotels are no longer so cheap, in the major capitals at least. Some of them have had luxury makeovers and others have put up their prices because of inflationary pressures in Europe such as power costs.

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