Market Trends

🌎 In 2026, Central and South America's Travel & Tourism sector is set to surpass the global average, with a 4.1% GDP growth, compared to the global 3.2%. International visitor spending in the region is expected to rise by 7.8%. Ecuador leads with an 11.6% GDP growth, while Venezuela's sector grows by 33.2%. Globally, Travel & Tourism will contribute $12 trillion, or 9.9% of GDP, supporting 376 million jobs. This growth highlights increased domestic demand and lower geopolitical disruptions.

🏨 Lifestyle hotels are the fastest-growing sector in global hospitality, driven by post-pandemic demand for experiential travel. In Asia Pacific, growth is rapid yet under-penetrated, with Gen Z preferring these hotels for their cultural and technological appeal. Despite rising construction costs, CBRE suggests conversions as a cost-effective investment strategy. As Gen Z's spending power grows, lifestyle hotels are set for sustained expansion. Gen Z is the largest demographic in the region, influencing market trends significantly.

📚 Major hotel groups have increased margins and customer ownership thanks to direct booking strategies over the past decade, as of May 28, 2026. Despite stable OTA market share, hotels benefit from lower commission costs and enhanced loyalty programs. U.S. business travel brands see more direct bookings compared to leisure properties internationally. AI travel assistants might impact both hotel and OTA visibility, posing a future distribution challenge.

🏨 Top-quartile branded assets in 2026 are refinancing into competitive five-year takeouts, while weaker assets struggle with lenders. Rate strategies from 2023-2024 now create disparities in profit, with select-service hotels outperforming full-service. Midweek business rebounds, driven by secondary markets' reshoring and healthcare. PIP costs have inflated 25-40%, and insurance renewals increased by 20-40%. Construction starts are below historical averages, protecting existing assets. Strategic refinancing and asset management are crucial for 2026's market, sorting hotels into "haves" and "have-nots.

🏨 The U.S. hotel industry in Q1 2026 experienced significant growth compared to 2025. ADR increased by 6% to $202.63, RevPAR by 8.7% to $129.46, TrevPAR by 9.4%, and occupancy rose to 64.3%. GOP margin improved by 4 percentage points to 41.8%. These figures indicate stronger demand and better profit conversion, with a focus on managing demand, pricing, and costs effectively amidst ongoing challenges.

📈 U.S. hotel performance in 2026 faces uncertainty due to Iran, Israel, and U.S. conflict. Geopolitical instability suppresses travel, affecting demand. U.S. hotels could benefit from domestic travelers staying in-country and international travelers avoiding the Middle East. Increased government and defense contractor activity may boost business travel. However, corporate travel might decrease, and rising costs and financial volatility could impact profitability. Hotels focused on active demand capture and profit optimization will better navigate these challenges.

📈 Wellness in Travel & Tourism (WITT) is expanding in Asia, a rapidly growing region for travel demand projected to reach USD 204.2 billion by 2026. Vietnam's Fusion Resort & Villas Da Nang and Alba Wellness Valley by Fusion, Indonesia's Bali Niksoma Boutique Beach Resort and GDAS Bali, and Nepal's Hotel Hokke Lumbini have achieved WITT Certification. These properties focus on integrated wellness experiences. WITT evaluates nearly 200 hotels globally based on 100+ criteria to maintain wellness standards.