Hotels, including those in Denver, are sitting pretty because of a fast-recovering economy and the prospect of getting more money for their rooms heading into the New Year, according to David Corsun, director of the Knoebel School of Hospitality Management at the University of Denver.
But he noted that discretionary spending in restaurants for most Americans has not fully rebounded and that they are likely to stay at home for meals or “trend down” to fast-casual restaurants such as Denver-based Chipotle or Panera.
Hotels appear to be rebounding from the 2008 recession more rapidly than after previous downturns, Corsun said, and certainly much more quickly than the days following the Sept. 11 terrorist attacks.
“Continuing the 2013 recovery, the hotel industry in 2014 will benefit from slightly higher occupancy rates, demonstrating year-over-year growth in most markets, including major cities like San Francisco, New York, Chicago and Denver,” said Corsun.
He said higher daily rates will be “the real driver in another nice jump in revenue per room available.”
He said legacy types of hotels such as Hilton, Marriott and others will begin to adapt their core brands and rethink their business models for Gen X and millennial travelers.
Younger customers demand more authenticity in their relationships with service providers, and Corsun predicted that hotels that “tend to deal with them in a staged, scripted and inflexible manner will not do well.”
“Hoteliers will find that they need to hire employees with considerable emotional intelligence and social skills to improvise and establish genuine customer relationships,” he said.