Topics covered in CoStar News Hotels podcasts over the last month span the globe and range from a demand slowdown for the summer months to how hoteliers can prepare for ICE raids.
Here are some takeaways from recent episodes of the CoStar News Hotels, Tell Me More and Next Gen in Lodging podcasts.
CoStar News Hotels
A labor attorney specializing in immigration issues told CoStar News' Bryan Wroten that it's a matter of "when" not "if" U.S. Immigration and Customs Enforcement agents and other law enforcement agents show up at hotels looking for people who are not eligible to work in the country.
“They need to prepare,” said Jessica Cook, a partner at law firm Fisher Phillips who has a specialty in immigration employment. “The government is laser focused when it comes to immigration compliance right now, and we're going to see the worksite enforcement continue.”
Those preparations should include creating a holistic plan for response and communicating it to employees.
During the monthly check-in with STR's Jesper Palmqvist, the conversation focused on Thailand, which faces some challenges despite being a favored travel destination.
"There's faith in Thailand as a market. ... And there's so much more that could be done and change in terms of visa policies, investment, regulation, transparency," he said, noting Thailand has a track record of "four or five decades of very strong and resilient tourism activity."
Meanwhile, hotel brand Sonesta Hotels International continues its years-long transformation, driven most recently by the sale of hotels by partial owner Service Properties Trust.
Sonesta Chief Development Officer Brian Quinn said his company has evolved while keeping its focus on owners' success intact.
"My guess is we're going to be in the real estate business for a long time on that front, but it does give us a unique window into what our franchisees are going through," he said. "And at the same time, when that transaction happens, the gravity inside the business is going to move heavily towards franchise."
As the summer travel season ramped up, there are signs hotels are in an evolving fight for share of wallet, but an expert from Deloitte says travel remains a priority for Americans.
"The share of wallet for travel just holds on," Deloitte's Transportation, Hospitality & Services research lead Maggie Rauch said. "It has a place in a lot of Americans' priorities, and I think part of that is that it's not something you get to do as much as you want. No matter how much money we have, we only have so much time ... and that has helped keep it steady."
A recent survey from Deloitte highlighted that economic uncertainty is playing a major factor in consumers' spending decisions, though.
Hotel industry leaders are also in the camp of those craving a higher level of certainty, and American Hotel & Lodging Association President and CEO Rosanna Maietta said her organization is working toward that in terms of taxing and regulation.
She also pointed to Los Angeles as a cautionary tale for a market that gives hotel investors and operators anything but certainty.
"It's a tough market," she said. "You haven't seen a lot of real hotel development in the last 10 years. People don't want to invest. They can't afford it. The math just doesn't make any sense. And so right now, if you think about it, travel and tourism accounts for almost a half a million jobs in Los Angeles alone. That's a lot of jobs. But these types of ordinances will force many people to go out of business, and that means those jobs are lost."
Taking a deeper dive into the extended-stay hotel segment, The Highland Group's Mark Skinner noted supply and demand trends for the segment mirror the larger hotel industry despite elevated investor and brand interest and superior profitability.
"Extended-stay supply and demand are both increasing, but they are increasing well below their long-term average, which is about 5% over the last 25 years," he said. "So over the last trailing 12 months, you've got supply increasing about 2.9%. You've got demand increasing at about 2.5%. Over the last five months, supply has actually increased faster than demand every month. So occupancy has fallen, but during the prior eight months, the reverse was true. In seven of them, occupancy increased."
This marks a shift from the COVID-19 pandemic period where extended stay hotels enjoyed better performance than other hotels.
Tell Me More
In the June episode of "Tell Me More: A Hospitality Data Podcast," CoStar's Jan Freitag and STR's Isaac Collazo dive into how hoteliers are having to adjust to an underwhelming summer travel season.
"We had hoped that this summer ... would turn positive, because the American leisure traveler sits on their hands and then — with a very short booking window — makes the booking," Freitag said. "I hope that's true, but where we look in May, I'm a little more worried now."
There were some worrying signs in May, with both occupancy and average daily rate down year over year.
Next Gen in Lodging
June was Pride Month, and Next Gen in Lodging focused on how hotels can become more welcoming to people in the LGBTQ+ community.
Erich Schwartzel, author and reporter for The Wall Street Journal, said it somewhat comes down to how much companies embrace diversity
"It's just so striking, because I was a reporter during the first Trump administration, when it seemed like every company was actively engaging in these political issues and we had a lot of CEOs speaking out about them," he said. "Now it seems like a couple of things have happened that has put the companies in a position where they are avoiding it altogether."