The average corporate negotiated hotel rate will increase
between 6.5 percent and 7.5 percent in 2016, according to Bjorn Hanson, a clinical professor at the New York University School of Professional Studies Tisch Center for Hospitality and Tourism.
That means the average rate could mark the highest rise in
corporate rates in the history of NYU’s annual report. Last year, corporate
rates increased approximately 6.25 percent, the largest increase since 2006.
Hanson said this year’s outlook shows that hoteliers are
trying to reach a more favorable parity between transient and corporate rates
than in previous seasons. “There is still some catching up to do from the
perspective of the hotel companies,” Hanson said. “In recent years, the
negotiated corporate rate increases ended up being less than average daily rate
increases, so even though corporate rates have been increasing, [they have] not
as much as other rates in general.”
Hanson said even though travel buyers “read the headlines”
around the hotel industry, some still may be surprised at the effect that high
occupancy, which is projected to continue at levels not seen since the 1990s,
will have on negotiations. “It gives the hotel executives a sense of confidence
that if some of these negotiated contracts don't work out, there's plenty of
other demand to help achieve a favorable occupancy and maybe even at a
higher rate,” Hanson said.
NYU based the analysis and estimates on interviews with
industry executives and corporate travel executives, on evaluation of industry
financial data, on press releases and on information available on hotel and
brand websites.