Key Global Shifts in Hospitality Expansion

Listen to the article 17 min This audio is auto-generated. Please let us understand if you have feedback. Following a year of broad financial unpredictability that suppressed growth for hotels, hospitality market leaders are looking towards 2026 with cautious optimism. Increasing functional costs are slated to challenge owners this year and lower-tier sectors could have a hard time amidst a growing wealth bifurcation.

And through all of it, hotel business are expected to strengthen their portfolios with brand-new brand name offerings and collaborations. As the year gets underway, Hotel Dive consulted with hospitality leaders from varying corners of the industry about their 2026 forecasts. Below are the top trends anticipated to impact hotel operations, efficiency, net system development and more this year.

Total wages, incomes and benefits paid by U.S. hotels increased to $127 billion in 2025, according to information from the American Hotel & Accommodations Association, shared with Hotel Dive. In 2026, that figure is projected to reach $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, rising labor costs posture a difficulty to net operating earnings development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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Rising labor expenses have actually been an obstacle for hoteliers for years, Davis stated, especially following the COVID-19 pandemic. In general, hotel labor expenses have actually increased 15.3% from 2019 to 2025, exceeding the 12.8% development in total operating income, according to AHLA.

3, 2024 in San Francisco, California. Justin Sullivan by means of Getty Images In 2026, Davis kept in mind, union settlements will be "front and center" in New york city City, where the New York Hotel and Gaming Trades Council's union agreement with the Hotel Association of New York City is set to expire in July.

"Need has actually not kept up with this pace," she said. "We're also seeing these obstacles intensified by legislation that targets hotel operations, such as extreme labor and licensing policies like the New York City City Safe Hotels Act. When need is falling and costs are soaring, the mathematics merely doesn't build up." Salaries, incomes and payroll-related expenses paid by hotels now represent more than 32% of total profits, according to AHLA.

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As more hotel guests turn to expert system to improve their travel experience, booking hotels directly through big language designs (LLMs) might be next, hospitality experts stated. Agentic commerce a procedure by which autonomous AI agents act upon behalf of a customer to find, compare and finish purchases is a trend that has accelerated across industries like retail.

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According to PwC's 2025 Vacation Outlook report, 76% of millennials said they're most likely to utilize AI for travel recommendations. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, informed Hotel Dive. Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct booking, larger multibrand hotel business will "embed LLMs into their own brand sites and mobile apps, and alter the method the customer searches," Kletzel stated.

"If you are not visible in an LLM search results page which lots of brand names aren't, and this is the huge panic that they're all going through today consumers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality product marketing at AI consumer experience platform Talkdesk, similarly informed Hotel Dive that hospitality gamers require to ensure their home details is being indexed by LLMs to appear in traveler questions.