Spending on capital expenditures by the U.S. lodging
industry this year is expected to reach a record $6.85 billion, a 3.8 percent
year-over-year increase, according to a report from Bjorn Hanson, a clinical
professor at the NYU School of Professional Studies Jonathan M. Tisch Center
for Hospitality and Tourism.
With U.S. lodging industry revenue per available room
projected to grow between 2 percent and 2.5 percent, Hanson said capex "could
increase between 60 and 70 percent more than the percent increase in RevPAR."
Historical U.S. Hotel Industry Capex Spend
2017: $6.85B
2016: $6.6B
2015: $6.35B
2014: $6B
2013: $5.6B
2012: $5.1B
2011: $3.75B
2010: $2.7B
2009: $3.3B
2008: $5.5B
2007: $5.3B
2006: $5B
2005: $4.8B
Enhancements to hotel properties, such as converting a
tub/shower unit to a walk-in shower or updating the bedding, typically fall
under capex. The priorities for capex spending this year include: redesigned
lobbies; increased Internet speed and bandwidth; new restaurant and food and
beverage concepts; updated in-room amenities, including ironing boards, coffee
makers, iPads and decor; larger flat-screen televisions; upgrades to A/V
equipment; improved revenue management and property management systems; and
equipment to support social media initiatives.
Many of these improvements, Hanson said, are expected of
hotel owners and franchisees to keep up with brand standards set by hotel
companies. He said guests' social media posts about property design, amenities
and quality form a somewhat new but persistent influence on capex.
Hanson's findings are based on interviews with select hotel
executives and hotel design and construction executives, analysis of brand
standards, and other sources, including press releases and media reports.