Global hotel rates are forecast to continue rising in 2025, according to a new study.
But price increases will moderate compared to the steep rises of recent years due to easing leisure travel demand and a surge in new hotel construction.
The projections come from the consulting team at American Express Global Business Travel (Amex GBT).
Detailed predictions for more than 80 major cities worldwide are contained in the TMC’s Hotel Monitor 2025 report , analysing hotel transaction data and factoring in local and macroeconomic variables including International Monetary Fund (IMF) data.
While price rises are mostly moderate across the globe, there are exceptions:
- New York continues to experience higher rate rises than the rest of North America, in part because of a continued block on the use of short-term rental accommodation.
- Cities in the Nordics are anticipated to see some of the highest room rate rises in Europe, as the region looks forward to improved economic prospects in 2025.
- India’s dynamic economy is fuelling demand for domestic and international inbound travel, putting upward pressure on hotel rates.
The study suggests that while the IMF expects global inflation to fall in 2025, hotel rates are likely to stay high due to labour shortages and rising wages. Supply is boosted by a boom in global hotel construction, with new developments concentrated in the US, China, India, Canada, and Saudi Arabia.
Technology is transforming hotel operations and guest experiences, helping hotels manage labour shortages. AI-powered tools streamline tasks like room assignments, allowing staff to focus on guest service. Smart room technology is enabling travellers to tailor the in-room environment to their needs and preferences.
Guests now see rooms as personalised retreats, driving demand for custom features and wellness options. Hotels are responding with offerings such as in-room fitness equipment and workout clothes.
Sustainability is another key focus, with access to the relevant data now essential to meeting both traveller and corporate sustainability goals.
Extended-stay properties are growing in popularity, especially in Asia, reflecting demand for flexibility and longer trips.
Amex GBT consulting vice president Dan Beauchamp said: “Stabilisation in the travel marketplace is good news for customers, but prices remain high, and challenges persist for companies managing a cost-effective corporate hotel programme.
“Data-driven decision-making is essential for smarter hotel sourcing, as is effective communication – maintaining open, ongoing dialogues to build stronger relationships with suppliers.
“Travel buyers can benefit from creative sourcing strategies, such as negotiating multiple room types, keeping an open mind on dynamic rates, and using TMCs’ negotiated rate programs to boost coverage in secondary and tertiary cities.”
Forecasts for key business travel destinations include:
New York up 4.7%
Las Vegas up 4.2%
Vancouver up 2.9%
Mexico City up 4.5%
Rio de Janeiro up 5.2%
London up 3.6%
Paris up 4%
Brussels up 3.6%
Berlin up 3%
Stockholm up 5.6%
Madrid up 3.6%
Rome up 2.9%
Hong Kong up 3.8%
Bengaluru up 9%
Delhi up 9%
Hanoi up 4.7%