Hotels Envision Group Bookings Will Make Up for Lost Business Trips

25.08.2023 - 14:09 / skift.com / Mark Hoplamazian / Chris Nassetta / Matthew Parsons

“An Outstanding year,” “thrilled to report,” “record-breaking…” every U.S. hotel group CEO has been jubilant in their earnings calls these past days.

Hilton’s Chris Nassetta possibly the most: “We’re at a pivotal moment with great opportunities ahead in a new golden age of travel.”

The execs say they’re finally benefiting from all of that pent-up demand. Across the board with their results reporting, it’s clear leisure travelers are mostly driving that recovery, with elements of blended travel mixed in.

They’re also optimistic on corporate travel. It seems group business is set to be the star in 2023, on top of extra business from workers hitting the road as the U.S. begins its infrastructure projects.

Hyatt CEO Mark Hoplamazian described 2022 as a “truly transformative year” during an earnings call on Feb. 16.

Group booking revenue hit a milestone in the company’s recovery, as it made it back to2019 levels in its fourth quarter — “a testament to our association and corporate customers prioritizing in-person interaction and connection,” he said.

His comments echo a report from Deloitte that also found inadequate video conferencing software was driving the recovery.

Revenue from business transient — for example, individual business travelers checking in for a night or two for a meeting — however was 18 percent below 2019 levels for the quarter.

A report last summer warned company travel budgets were being cut by a quarter, a precursor to recent announcements involving layoffs and tighter control on spending.

“Conversations with corporate customers continue to suggest further recovery is ahead for group and business transient travel and leisure transient shows no signs of slowing as evidenced by the strong bookings at our resorts,” added Hoplamazian.

Hilton is bullish too on the resurgence of group bookings.

The segment’s revenue per available room, or RevPAR, which is the metric most hospitality brands use to measure success, saw the biggest quarter-over-quarter improvement and it has recovered to 2019 levels

“… People really got comfortable, we were through Covid and they could start planning events,” said Nassetta during an earnings call earlier this month. “They’ve been planning them like crazy. Even the biggest groups, all the association stuff, that really starts to hit the second half of this year because of all of the planning.”

He said group demand was resilient as people have gone years without doing things that they need to do for survival.

“Even with robust forward bookings, the pipeline still remains strong with tentative bookings up more than 20 percent versus last year, helped by rising demand for company meetings as organizations bring their teams back together,” he said

But Nassetta