AH September 2024

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September 2024 | Volume 25 #229

The Voice of Asian American Hoteliers

Joining the campaign

Associations push advocacy in light of presidential election

Hotel companies in the news include:

Auro Hotels, Reha Hotels LLC, Krins, Inc., Kenny Group LLC

Everything and

the kitchen sink

FF&E selection impacts guest

satisfaction, reputation and success

Hihotels focuses on

communication

Its advisory council targets network growth

via stronger partnerships

16

Genuine Relationships. Real Results.®

Contact Matthew Hostetler, Chief Development Officer, [email protected] / redrooffranchising.com

F R A N C H I S E E

S U C C E S S S T O RY

KENISH PATEL

CAME TO THE US IN 2001.

WENT FROM FRONT DESK

TO GM IN ONE MONTH

S U C C E S S S T O RY

OPENED

FIRST HOTEL

IN 2010

CONVERTED

TO RED ROOF

IN 2018

NAMED OPERATOR OF THE YEAR IN 2020

INDEX

103.5%

REVPAR $38.77*

OUTSTANDING

BRAND

CONTRIBUTION**

45.5%

Red Roof Inn

HomeTowne Studios

When I was a child, I would make

hotels as projects. I called them

Kenish Hotel. Today, MY KENISH

HOTEL IS A RED ROOF.

*STR Average Revenue per Available Room Index based performance for all Affiliate-Owned and Franchised Red Roof Inns open and operating for at least one year and for all of calendar 2023 with any temporary closures being less than 90 days, 499 hotels. **The Brand Contribution is

the percentage of room revenue generated for the properties through the Red Roof Inn website, call center, group bookings, National Sales, Global Distribution systems (GDS), third party websites and by RediRewards members booked directly with Affiliate-Owned properties operating

for at least 1 full year and all of calendar 2023 with any temporary closures being less than 90 days, 65 hotels. This is not an offer. No offer or sale of a franchise will be made except by a Franchise Disclosure Document first filed and registered with the applicable authorities. For New

York: An offering can only be made by a prospectus filed first with the Department of Law for the State of New York. Such filing does not constitute approval by the Department of Law. For Minnesota: #F-5824. Red Roof Franchising, LLC, 7815 Walton Pkwy, New Albany, Ohio 43054.

© 2024 Red Roof Franchising, LLC

HomeTowne Studios by Red Roof® and Red Roof Inn® /

HomeTowne Studios by Red Roof® Dual-Branded Property

O W N E R

8/16/24 3:59 PM

8/16/24 3:59 PM

As the American people go to the polls to vote

this November, hotel industry associations

such as AAHOA and the American Hotel &

Lodging Association continue to advocate for

proposed legislation they say will benefit the

industry.

Cover Story

News

Franchise Relations

Design

Product Feature

20 | Joining the campaign

Associations push advocacy in light of

presidential election

5 | ‘Protect NYC Tourism Coalition’

marches against hotel bill

Industry associations say the legislation will

harm New York’s hotel

and tourism industry

6 | Blackstone, AAHOA buy majority

stake in M3

The deal is AAHOA’s first large strategic

investment and the association expects

to give members greater access to

technology

8 | IHG revenue rises amid U.S. market

recovery

The company's U.S. RevPAR turned positive

from April, increasing 2.5 percent in Q2

9 | Hilton’s net income, RevPAR and

pipeline rise in Q2

Second-quarter occupancy in the U.S. rose

to 76.8 percent, ADR to $172.36, and

RevPAR to $132.33

10 | CBRE cuts RevPAR growth forecast to

1.2 percent for 2024

The research group remains optimistic that

RevPAR will hit a record $100.54 this year

STR, TE project positive growth for U.S.

hotels in 2024-25

The 2025 occupancy growth projection was

increased by 0.2 percentage points

11 | Resolute Road, Choice host

investment forum in Dallas

About 100 hospitality executives discussed

the future of the extended-stay market

16 | Hihotels focuses on communication

Its advisory council targets network growth

via stronger partnerships

18 | Luxury in the Twin Cities

Hawkeye’s Cambria in Minneapolis finishing

second year in style

26 | Everything and the kitchen sink

FF&E selection impacts guest satisfaction,

reputation and success

On the cover

12 | Sonesta launches rebate program,

signs new franchisees

The company will credit the incentive

quarterly on franchise fee statements

14 | Shatterproof to recognize STR’s Hite

at ALIS

She will receive the award at the Hospitality

Heroes Reception on Jan. 29

15 | U.S.-India sign pact to boost MSMEs

in global market

AAHOA praised the agreement for its role in

supporting small businesses,

including hotels

COMING

NEXT ISSUE:

Super 8 celebrates 50th anniversary

Contents

05

10

12

13

18

16

Gujarati translation of top stories

begins on page 30

www.asianhospitality.com

September 2024 | Issue 229

8/16/24 3:59 PM

8/16/24 3:59 PM

08

ISSN 1938-8837

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Viraj Chaudhari

Not a drop to drink

t 10:30 p.m. on a Saturday night about a month ago, my wife

noticed a growing puddle of water behind our washing machine

in our laundry room. I quickly shut off the water to the machine,

but the water kept dripping.

Then I felt the wall and noticed it was warm, and quickly realized

that the problem was much bigger. On the other side of the wall is our water

heater, and sure enough I found that the outlet pipe at top had sprung a leak.

More bad news followed when I learned that the shut off valve for the tank

no longer worked, so I had to shut off water to the entire house. At 10:30 on a

Saturday night.

That Sunday was bleak, to say the least.

Fortunately, we were able to fill a couple of ice chests with water from our

kind neighbor’s garden hose to use to fill toilet tanks when we flushed (which

was only when absolutely necessary, if you know what I mean). We ran to the

store the next day to grab some more drinking water, then hunkered down for

a day and a half of deprivation until the plumber could come.

It was hardest on my oldest daughter who was working all weekend and

never had a chance to take a shower. The rest of us were able to shower at the

neighborhood pool house.

We also had a pile of dirty dishes left over from Saturday night’s dinner (I

was washing them when we discovered the leak). Instead of cooking a Sunday

dinner we grabbed some Bojangles chicken, so that’s not bad.

By Monday afternoon we were back in the flow of things, so to speak, but a

lesson was learned: We are certainly a little spoiled here in the U.S. Over the

summer we also experienced a protracted AC breakdown that underscored

my family’s dependence on modern convenience.

It makes me appreciate what we have and more keenly aware of the fact that

we could easily lose it. We are a nation at peace and even if the economy gets

bumpy we still have plenty. At the same time, there are children in this country

who go hungry except for their lunches at school.

So here’s hoping the lights stay on and the toilets keep flushing in all or

our homes, and best wishes to the millions of people who do not have such

luxuries!

Edward J. Brock, Senior Editor

[email protected]

Follow Asian Hospitality online...

www.facebook.com/asianhospitality

twitter.com/amg_ah

www.asianhospitality.com

Editor's Letter

04

www.asianhospitality.com

September 2024 | Issue 229

05

News

www.asianhospitality.com

September 2024 | Issue 229

ore than a thousand

hotel owners,

workers and small

business owners from the

newly formed "Protect NYC

Tourism Coalition" rallied on

the steps of New York's City

Hall on Sept. 12 to protest

the city council's "Safe

Hotels" bill. The coalition

also sent a letter urging the

council to reject the bill, also

known as “Int. 991”, arguing

that the bill threatens the

sustainability of New York

City's hotel and tourism

industries and jeopardizes

the livelihoods of thousands

of workers.

The coalition includes

members from AAHOA, the

American Hotel & Lodging

Association, the Hotel

Association of New York

City, the Real Estate Board

of New York, the Coalition for Hotel

Subcontractors, the NYC Minority

Hotel Association, the National

Association of Black Hotel Owners,

Operators, and Developers, along

with other groups and stakeholders

supporting New York City’s tourism

industry.

First introduced by Councilwoman

Julie Menin over the summer, Int. 991

is presented by supporters as a “simple

licensing bill.” Opponents argue it

would impose operational mandates

that could drive many hotels out of

business, jeopardizing 42,000 hotel

jobs and nearly 260,000 jobs supported

by the industry, along with billions in

revenue for New York City.

AAHOA treasurer Rahul Patel, joined

by AAHOA Northeast regional director

Preyas Patel and Mid-Atlantic regional

director Mahendra Patel, voiced

industry concerns about the proposed

act.

"The Safe Hotels Act was not created

in good faith, or the city council

would have reached out to us and our

members," Rahul Patel said. "This act

the city council is trying to pass will

destroy our livelihoods. It not only hurts

small businesses but will also harm

thousands of hospitality employees in

the New York City area."

He noted that hotels in Manhattan

contributed more than $2.3 million in

state and local taxes in 2021 and $7.2

million to the GDP. These numbers

demonstrate how vital small hotels are

to the local economy.

"I extend my deepest gratitude to

Rahul Patel, our hospitality leaders,

and the hundreds of supporters who

rallied today," said Miraj Patel, AAHOA’s

chairman. "It is my sincere hope that

the city council will listen to our voices

and collaborate with us to find balanced

solutions that benefit everyone. AAHOA

stands ready to partner in this process."

"The Safe Hotels Act, as it stands,

poses a serious threat to our members'

businesses and their livelihoods and

threatens to undermine that economic

engine at a time when the industry

is still recovering from

unprecedented challenges,"

said Laura Lee Blake,

AAHOA’s president and CEO.

‘Legislation causes

irrevocable damage’

“This legislation will cause

irrevocable damage and

hurt thousands of guests,

hotel owners, workers, and

small business owners who

support New York City’s

hotel and tourism industry,”

said Kevin Carey, AHLA’s

interim president and CEO.

“The economic toll of this bill

will reverberate for years,

forcing hotels to lay off hard-

working staff, raise rates,

and even permanently close.

This is not a licensing or

safety bill—it’s a government

takeover of New York City

hotels, and we will not stop fighting

until it’s defeated.”

“Int. 991 is a solution in search of a

problem. It imposes staffing mandates

that most hotels cannot afford, forcing

closures and disrupting hotel lending

and transactions,” said Vijay Dandapani,

Hotel Association of NYC’s president

and CEO. “This bill harms the financial

health of hotels and threatens the

sustainability of New York’s tourism

industry. The City Council should be

working with us, not against us, to

support job creation and economic

recovery.”

The coalition also emphasized the

safety protocols already in place at

member hotels and the industry’s

commitment to ending human

trafficking.

In August, New York hoteliers

Mukesh and Nikul Patel formed the

NYC Minority Hotel Association to

oppose the proposed law, calling it

“unnecessary, redundant rules that

would cripple the hotel industry.”

‘Protect NYC Tourism Coalition’

marches against hotel bill

Industry associations say the legislation will harm New York’s hotel

and tourism industry

More than a thousand hotel owners, workers, and small business owners

from the "Protect NYC Tourism Coalition" rallied at New York's City Hall on

September 12 to protest the City Council's "Safe Hotels" bill. Pictured, AAHOA

Treasurer Rahul Patel, left, speaks to coalition members.

www.asianhospitality.com

September 2024 | Issue 229

News

06

AHOA is joining Blackstone

Growth LP and afÏliated funds

in the association’s first strategic

investment, signing a definitive

agreement to acquire a majority stake in

M3 LLC, a hospitality accounting software

firm. The association claims the deal will

significantly benefit its members and the

entire hospitality industry.

However, the terms of the deal were

not disclosed.

“AAHOA is excited to make its

first strategic investment alongside

Blackstone, a move that will

significantly benefit our members

and the entire hospitality industry,”

said Miraj Patel, AAHOA’s chairman.

“This partnership with M3 will bring

AAHOA members access to advanced

technology and innovative solutions

that can enhance operational efficiency

and drive growth. We are committed

to empowering our members with

the tools and resources needed to

succeed in an evolving market, and

this collaboration marks a pivotal step

toward achieving that goal.”

The investment will accelerate the

company’s growth by enhancing product

expansion and supporting the adoption

of M3’s software, which helps hotel

operators run more efÏciently, the

companies said in a joint statement.

“Blackstone’s background in hospitality

made them the natural choice as our first

equity partner,” said John McKibbon, M3’s

founder. “Together, we look forward to

propelling our innovation and growth

to best serve our customers in an era of

continued technological advancement.”

McKibbon founded M3 in 1998 to

address the accounting needs of his

family's hotel management company,

the statement said. It serves as the

system-of-record for financial data for

more than 1,000 hotel operators and

management companies. Currently, it

provides accounting, labor management

and business intelligence products to

more than 8,000 properties across North

America.

“M3 has become a leading finance

and accounting software platform

for countless independent and

family-owned hotel operators, as

well as some of the largest hotel

management companies, that have

relied on its technology to support the

professionalization and scale of their

businesses,” said Ramzi Ramsey, a

managing director at Blackstone. “As

M3’s first institutional capital partner,

we’re excited to harness Blackstone’s

deep expertise and network within the

real estate and technology sectors to

help enhance its product offering to

better serve new and existing companies

as M3 continues to grow.”

Blackstone Growth, a private equity

growth fund managed by Blackstone, was

founded in 2020.

Carlton Fields P.A. served as legal

counsel to M3, while Houlihan Lokey

provided certain assistance to M3 in

connection with the transaction, the

statement said. Evercore acted as the

exclusive financial advisor to Blackstone,

and Kirkland & Ellis LLP served as legal

counsel to Blackstone.

Blackstone, AAHOA buy

majority stake in M3

The deal is AAHOA’s first large strategic investment and the association expects

to give members greater access to technology

In its first strategic investment, AAHOA, along with Blackstone Growth LP and afÏliated funds,

recently signed a definitive agreement to acquire a majority stake in hospitality accounting software

firm M3 LLC. AAHOA Chairman Miraj Patel said the investment will greatly benefit its members

and the hospitality industry.

www.asianhospitality.com

September 2024 | Issue 229

www.asianhospitality.com

07

News

— by J.D. Power

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News

08

www.asianhospitality.com

September 2024 | Issue 229

nterContinental Hotels Group

reported a 3 percent increase in global

RevPAR in the first half of 2024, with

3.2 percent growth in the second quarter,

driven by a recovery in U.S. markets. ADR

rose 2 percent, and occupancy increased

by 0.6 percentage points in the first half,

leading to a 6 percent rise in total gross

revenue, reaching $16.1 billion.

The company's U.S. RevPAR was

positive starting in April, increasing by 2.5

percent in the second quarter, IHG said in

a statement. In May, IHG reported a 0.3

percent year-over-year decline in RevPAR

for the Americas in the first quarter, due

to a 1.9 percent drop in U.S. RevPAR.

“We are making great progress on the

delivery of our strategic priorities and

the clear framework to drive future value

creation that we set out in February,”

said Elie Maalouf, IHG’s CEO. “RevPAR

growth accelerated in the latest quarter,

reflecting a strong U.S rebound in the

second quarter and the breadth of our

global footprint, and development activity

continues to increase. Together with

system growth, notable margin expansion

and the benefit of returning surplus

capital through buybacks, adjusted EPS

growth was up 12 percent.”

Global growth

The Berkshire, England-based IHG

expanded its global footprint with a 4.9

percent increase in gross system growth

year-over-year and a 3.2 percent rise in

net system growth. The company opened

18,000 rooms across 126 hotels in the first

half of the year, bringing its global estate

to 955,000 rooms in 6,430 hotels. During

the same period, IHG signed 384 hotels

comprising 57,100 rooms, representing

a 67 percent increase from the previous

year, or a 15 percent rise when adjusting

for acquisitions like Iberostar and

NOVUM.

“We celebrated 126 hotel openings

in the half and the signing of a record-

breaking 384 properties, equivalent to

more than two a day,” said Maalouf.

“These included the first six openings and

118 signings from the NOVUM Hospitality

agreement, which doubles our presence

in the important and attractive German

market. After growth of more than 7

percent in the first quarter, a very busy

second quarter saw 23 percent more

signings year on year or a more than

doubling when including NOVUM, and

this keeps us on track for net system size

growth expectations.”

Robust financials

IHG's revenue in the first half of the year

rose 4.3 percent to $2.32 billion from

$2.23 billion a year earlier. However,

pretax profit fell 17 percent to $472 million

from $567 million, the statement said.

The company’s operating profit from

reportable segments rose by 12 percent

to $535 million, though this includes a $10

million adverse currency impact.

The reported operating profit of $525

million reflects a planned reduction in

the prior System Fund surplus and no

exceptional items, compared to an $87

million profit in 2023, IHG said. Adjusted

EPS increased by 12 percent to 203.9¢,

despite higher adjusted interest expenses

and a 5.6 percent reduction in the weighted

average number of ordinary shares.

IHG revenue rises amid

U.S. market recovery

The company's U.S. RevPAR turned positive from April, increasing 2.5 percent in Q2

InterContinental Hotels Group, parent company of Holiday Inn brands, reported a 3 percent increase

in global RevPAR in the first half of 2024, with 3.2 percent growth in the second quarter, driven by a

recovery in U.S. markets.

09

News

September 2024 | Issue 229

personalized

support and training

“ My Assurance & Marketing Program

director truly cares about me and

my hotel. I’ve never experienced this

before from a hotel franchise.”

This is not an ofering. Federal laws and regulations and the laws and regulations of some states and provinces regulate the ofer and sale of franchises. An ofering

will only be made in compliance with those laws and regulations, which may require that we provide you with a disclosure statement. © 2024 Hospitality International

800-892-8405 • hifranchise.com • [email protected]

delivers

Ravi Master

Owner, Scottish Inns

Locust Grove, GA

Family member since 2016

ilton Worldwide Holdings reported net income of $422

million for the second quarter ending June 30, up from $413

million last year. The development pipeline grew 15 percent

year-over-year to 3,870 hotels with 508,300 rooms, an 8

percent increase from the previous quarter. Systemwide

RevPAR rose 3.5 percent year-over-year due to higher

occupancy and ADR.

"We are pleased to report a solid second quarter, with an

increase in RevPAR of 3.5 percent, driven by growth in all

segments, with particularly strong group performance,”

said Christopher Nassetta, Hilton’s president and CEO. “On

the development side, we ended the quarter with a record

development pipeline, up 15 percent from the prior year and

up 8 percent sequentially from the first quarter, including

strategic partner hotels. Looking forward to the rest of the

year, with the continued growth of our existing brands, as

well as the addition of our new brands and strategic partner

hotels, we expect net unit growth of 7 percent to 7.5 percent

for the full year."

Adjusted EBITDA for the three months ended June

30 was $917 million, up from $811 million in 2023, Hilton

said. Management and franchise fee revenues increased

by 10 percent year-over-year. In the US, second-quarter

occupancy rose by 1.1 percentage points to 76.8 percent, ADR

increased by 1.4 percent to $172.36, and RevPAR climbed 2.9

percent to $132.33.

Hilton opened 165 hotels with 22,400 rooms in the second

quarter, adding 18,000 net rooms for 6.2 percent net unit

growth. The company expanded its lifestyle portfolio by

acquiring the Graduate brand, adding 32 hotels and four

more in the pipeline. In July, Hilton partnered with Small

Luxury Hotels of the World, adding 400 SLH hotels to its

system. The NoMad London, the first NoMad hotel, also

joined Hilton’s portfolio, and 27 Spark hotels opened, more

than doubling the brand’s supply.

Hilton added 62,700 rooms to its development pipeline

during the second quarter. As of June 30, the pipeline

included 3,870 hotels with 508,300 rooms, up 15 percent

year-over-year and 8 percent from the prior quarter. These

hotels are in 136 countries and territories, including 39 with

no previous Hilton presence, with 251,800 rooms under

construction and 298,800 rooms outside the US. Hilton’s

global hotel count surpassed 8,000 in July.

For 2024, Hilton projects a 2 percent to 3 percent increase

in systemwide comparable RevPAR (currency-neutral)

compared to 2023. Net income is expected between $1.53

billion and $1.55 billion, with adjusted EBITDA projected

at $3.37 billion to $3.40 billion. Contract acquisition costs

and capital expenditures, excluding reimbursements, are

estimated at $250 million to $300 million.

Hilton forecasted a 2 percent to 3 percent increase in

systemwide comparable RevPAR (currency-neutral) during

the third quarter. Net income is projected to be between $435 million

and $448 million, with adjusted EBITDA ranging from $875 million to

$890 million.

Hilton’s net income, RevPAR and

pipeline rise in Q2

Second-quarter occupancy in the U.S. rose to 76.8 percent, ADR to $172.36, and

RevPAR to $132.33

News

10

www.asianhospitality.com

September 2024 | Issue 229

BRE Hotels recently reduced

its U.S. hotel forecast as

lodging demand dips amid soft

leisure travel and slower corporate

profit growth. The upcoming election

in November and other economic

factors also led to the revisions.

The research group now projects

a 1.2 percent RevPAR increase for

2024, down from 2 percent in May.

However, it expects a 2 percent

RevPAR growth in the second half of

2024, up from 0.5 percent in the first

half, driven by international tourism

and election events.

Lodging industry performance

is closely linked to economic

strength, with GDP growth generally

correlating with RevPAR growth,

CBRE said in a statement. The

company forecasts 2.3 percent GDP

growth and 3.2 percent average inflation

for 2024.

“We expect low single-digit RevPAR

growth over the near-term as election-

related events, growth in inbound

international travel and an anticipated

lower interest rate environment

should support hotel demand,” said

Rachael Rothman, CBRE’s head of hotel

research and data analytics. “Challenges

including weakening consumer

spending and increased competition

from short-term rentals, cruise lines

and other lodging alternatives pose

downside risks.”

CBRE remains optimistic that RevPAR

will reach a record $100.54 this year, 114.5

percent of 2019 pre-pandemic levels, the

statement said. This forecast is based on

a 1.1 percent ADR growth and a 10-basis

point increase in occupancy.

“Following stronger-than-expected

GDP growth in the second quarter,

CBRE anticipates a slowdown in

economic growth in the second half

of 2024 and into 2025,” said Michael

Nhu, CBRE’s senior economist and

head of global hotels forecasting. “If

interest rate cuts do not stimulate

growth and the economy continues

to weaken, we may see a decline in

RevPAR.”

According to CBRE, despite

potential challenges, travel demand

remains strong, with record year-

to-date TSA throughput in the U.S.

at nearly 549 million passengers, up

5.4 percent year-over-year.

The research firm expects

rising global wealth and limited

supply growth to support lodging

fundamentals long-term, forecasting

compound annual supply growth of under

1 percent over the next three years due to

high financing and construction costs.

In May, CBRE forecasted 2 percent

RevPAR growth for U.S. hotels in the

second half of 2024, down from 3 percent

estimated in February. The company

expected stronger growth in the latter

half of the year, driven by international

tourists, holiday travel and limited

supply growth.

CBRE cuts RevPAR growth forecast

to 1.2 percent for 2024

The research group remains optimistic that RevPAR will hit a record $100.54 this year

CBRE Hotels recently reduced its U.S. hotel forecast, projecting

a 1.2 percent RevPAR increase for 2024, down from 2 percent

estimated in May. It expects 2 percent RevPAR growth in the

second half of 2024, up from 0.5 percent in the first half, driven by

international tourism and election events.

TR and Tourism Economics updated

their 2024-25 U.S. hotel forecast, raising

projected occupancy by 0.2 percentage

points and revising the previous forecast of a

year-over-year decline. However, ADR gains

were downgraded by 0.1 percentage points, while

RevPAR remained unchanged at a 2 percent year-

over-year increase.

The occupancy growth projection for 2025 was

also lifted by 0.2 percentage points, while ADR

and RevPAR increases remained at 2 percent and

2.6 percent, respectively, STR and TE said in a

joint statement.

“Midscale and economy hotels are continuing

to feel the effect of fewer lower-income

travelers,” said Amanda Hite, STR’s president.

“On the other hand, high-income households

continue to travel, but domestic levels are

constrained due to an increase in outbound

travel. The stronger dollar continues to pressure

international inbound demand, especially as the

cost-of-living crisis continues in Europe and

airlift rebuilds across Asia Pacific.”

In June, STR and TE significantly downgraded

the 2024-25 U.S. hotel forecast, reflecting lower-

than-expected performance and reduced growth

projections for the year.

“Economic growth is expected to be slower

next year, but with strong household balance

sheets, a gradual upswing expected in business

investment, and moderating inflation, we

anticipate a favorable context for moderate travel

growth, said Aran Ryan, TE’s director of industry

studies.

“Further gains in international inbound

travel, as well as in business and group travel, are

also expected to help support lodging demand

growth next year.”

Hite said annual GOP and EBITDA margins

are forecasted to improve slightly year over

year.

“For 2025, higher growth is expected across

both metrics due to lower labor costs, which are

set to decrease slightly for a majority of the chain

scales,” she said. “Upper midscale chains are still

expected to maintain the lowest labor costs this

year, with 2025 levels forecasted to come in $168

lower than Luxury chains.”

STR, TE project positive growth for U.S. hotels in 2024-25

The 2025 occupancy growth projection was increased by 0.2 percentage points

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