NEW YORK — Artificial intelligence has been hailed as a tool that will fundamentally change the hospitality industry. Experts believe it can serve this purpose through cutting costs, driving revenues and transforming guest search tendencies.
Umar Riaz, managing director of real estate, hospitality and construction consulting at EY, said he is working with hotel companies to define a three- to five-year plan that can reduce their costs by 30% to 50% with the aid of AI.
"Really the big benefit of AI is imagining end-to-end processes using agentic AI," he said during a session at the 2026 NYU International Hospitality Investment Forum.
Richard Valtr, founder of Mews, said this idea of using end-to-end processes will "have a huge impact on the industry." For example, instead of a hotel's property management team, restaurant team and housekeeping team all using different systems, AI can serve as a coordination connector between the teams on the operations side.
Valtr believes the biggest opportunity for AI to make an impact on hotels is with generating revenue. It starts with having better knowledge of the guest upon arrival so front-office workers can offer a more personalized service, such as trip recommendations.
"The hotel itself can actually step out of its own property to actually start to redefine more of a 24-hour, 72-hour journey of that customer, rather than staying in the eight-hour, bed-and-a-bath box," he said.
That shift has already started to occur.
Anna Scozzafava, chief strategy officer and senior vice president of technology at Choice Hotels International, said consumers are starting their searches with AI platforms. This has forced brands such as Choice to home in on their search visibility on AI-generated chatbots.
"You've got to drive the right content, you've got to make sure you're working with the right booking platforms," she said. "If you don't have the infrastructure and the investments already in place, you're going to get left behind."
Hilton built and launched an in-house AI planner on its website in March that is trained on all of its property data, Senior Vice President and Chief Information Officer Michael Leidinger said. Customers can describe to the chatbot what they are looking for in a trip in a particular market and the system can help suggest which Hilton property fits their desires best.
"We have to be deeply engaged with all the big companies — Google, ChatGPT, OpenAI, Anthropic — because there will be no one dominant model amongst those players," he said. "I think the entire distribution landscape is going to be turned on its head in a few years."
AI is having the most impact on day-to-day hotel operations right now, Scozzafava said. Choice has rolled out a suite of AI tools to its franchisees and owners over the past couple of months, and it's already delivered tangible value, she added.
One example of this is a tool that is aimed to reimagine the request-for-proposal process. Scozzafava said it's led to a 30% reduction in response time and a 250-basis-point increase in conversions.
"As we continue down this track and as we learn more, the forecasting, the investment decisions, the data is going to get better and stronger, and you'll see a much more outsized impact in the future on that," she said. "But today, where we're focused, anyway, is really embedding into our franchisee systems, and we have an immediate impact right now."
Hilton has deployed a global messaging solution that can handle the most basic requests from consumers such as inquiries about the time of breakfast at a hotel. That chatbot is handling about 55% of its call center chats and 36% of property-level chats, Leidinger said.
The use of AI to enhance the customer experience is the one area where everyone in the industry is seeing results, Riaz said. The next step is to conceptualize how it will have an effect on the corporate level.
Another AI tool Hilton has been rolling out is one that focuses on managing the life cycle of a hotel from the opening stage through renovations, property-improvement plans and relicensing. Leidinger said 80% of the tool's recommendations for licensing purposes were approved by people reviewing them, while the other 20% were more complex situations that would have required deeper analysis anyway.
"Now imagine we take that capability and extend it across that entire life cycle of a hotel; that is an incredibly powerful tool for both Hilton and others to really simplify how you are operating those hotels and the asset," he said.
In order to justify AI investments, Riaz said hotel companies need to sync the investment to metrics that can show whether the return is a net positive or not.
"There are a lot of pools of value, whether it's cost reduction, whether it's revenue enhancement, customer experience," he said. "You've got to tie it to metrics to justify the investment."
Scozzafava said the investment has to show up in the profit-and-loss statement so there's a clear ROI. The tools also need to be seamless when it comes to pricing and demand generation so the metrics show up.
"From an owner perspective, AI should really be a practical use case, not something [else] that they're actually having to learn ... on top of what they're already doing," she said.