NASHVILLE, Tennessee — This current budgeting season is likely not a fun one for many hotel revenue managers.
Stuck between demanding hotel owners and a complicated macro-economic environment, revenue experts are increasingly the ones being called on to make sense of everything. With that in mind, Pyramid Global Hospitality's Senior Vice President of Revenue Management Lori Kiel said there's likely to be many revenue departments on edge at the moment.
"It's a little bit nerve-wracking right now because we are trying to get our forecasts shored up for the rest of the year so we can now do the budgets," she said on the latest episode of the CoStar News Hotels podcast. "That's where it gets a little tricky, because, again, you weren't necessarily wanting to give up on the rest of the year because if this year has taught us nothing else, you can't bank on year-over-year trends, and you can barely bank on what's happened in the last eight weeks. So I think that's the part for me that probably gives me pause right now, is, how do you hedge those bets?"
The theme for this budget season may be healthy communication with hotel owners, Kiel said.
"Well, for us, I think what we owe the owners is to make sure that we understand what the hotel's performance potential is," Kiel said. "When they were in a similar timeframe, what did that look like, and what did the year after look like? So while I'm also big on saying be careful about the trends you follow and looking too far back, I think that in this moment you have to understand that, especially relative to the economics and the politics, there is a lot at hand here that wouldn't necessarily be worthy of calling a trend."
Kiel said the hope is the pace of policy changes coming out of Washington D.C. could slow down to make forecasting a bit more stable, but one thing she is expecting going forward is the environment of weaker international demand into the U.S. to persist.
"I don't feel optimistic on that side," she said. "I feel like this is the way it is right now, and I think it may play like this for a while. I didn't see anything that made me feel like, 'OK, well, we went through that, and now we're coming out of it.' I don't see that."
For the rest of CoStar News Hotels' conversation with Pyramid Global Hospitality's Lori Kiel, listen to the podcast above.