NEW YORK — Hoteliers are always looking for ways to push revenues and win in the margins. Strategic renovations and artificial intelligence are a few of the sources of extracting incremental value.
Panelists spoke about the strategies they've used during the "Driving alpha in uncertain markets: Maximizing hospitality value" session at the recent 2026 NYU International Hospitality Investment Forum.
Deanne Brand, senior vice president of strategy, enterprise analytics, risk and treasurer at Host Hotels & Resorts, said the real estate investment trust invested $2 billion of return on investment back into its assets from 2019 to 2025.
"We strongly believe in transformational renovations," such as repositioning spas or food-and-beverage outlets, she said. "The types of resorts and hotels that we own, we want to leverage and really extract value from that fluid consumer."
Of the 21 transformational renovations that have stabilized in Host's portfolio, the hotels have gained 9 points of revenue per available room share index on average, which Brand said is "meaningful growth."
When Host is planning a renovation, the company underwrites and conducts a case study to determine the additional rates it can drive through a repositioning, she said. It also compares its pricing and product to competitors in the market to ensure the changes will stand out and drive business.
Andrea Grigg, senior managing director and global head of hotel asset management at CBRE, said there has to be a certain level of intention behind every hotel renovation. In addition to delivering a new experience to the guests, it also has to drive efficiencies.
CBRE recently led the renovations of two full-service restaurants into bars with live components at two luxury hotels. Grigg said the results have been that food costs are down while profitability is up. One of the restaurants went from losing significant money to breaking even.
"When you look at ROI, you do your homework, and the dollars that you're going to invest have to be driven by very thoughtful exercises of ROI that go beyond just increasing prices or increasing captures," she said.
Lana Yoshii, senior director of investments at Sonesta International Hotels, said the company similarly renovated an on-property restaurant, reducing the seating from 90 to 40 and converting the extra space into retail. The renovation resulted in an average daily rate increase of 10% along with a jump in occupancy.
The renovation "wasn't about the food-and-beverage profit on the front end, it's about, 'Hey, we have a much better overall hotel,'" Yoshii said.
Joseph Bojanowski, president of PM Hotel Group, said coming into the year, its focus was on value enhancement for the guest. This includes preventative maintenance to ensure each room works properly.
"That's a great guest experience that's also really efficient in the environment where electricity and other utility costs are going up significantly. And then charging for that value enhancement when you get it [through] ADR," he said.
In keeping the rooms in good shape from a functionality standpoint, guests will be more likely to contribute ancillary revenues by sticking around the property for a drink or considering a late checkout, Bojanowski said.
"Our objective there being to drive GOP margins primarily through revenue — ADR-enhanced third revenues — to translate that into EBITDA per available room, cash flow, and then ultimately value enhancement there, whether it's a refi, exit or whatever it might be," he said.
Artificial intelligence
Artificial intelligence will play a role in driving additional revenues, the panelists said.
For Host to invest in any technology, not just AI, it has to fit at least one of three components: improve operational efficiencies; drive incremental revenue; or enhance the guest and employee experience. It's important to have test properties that can run trials with new technology to validate the proof of concept before rolling out a widespread adoption given the investment dollars at play, Brand said.
The shift from search engine optimization to generate operative optimization has already begun, Bojanowski said. PM Hotel Group updated its photos on its website and shifted to bullet-point style information to increase the chances of its properties showing up in an AI search.
AI is changing how travelers are booking, and CBRE is doing tests on investments into AI platforms to increase recognition of its hotels, Grigg said.
"We are being very proactive on that front, really testing and investing how we can get that visibility up. It's a very competitive market out there," she said.