Strategic Travel Symposium: As Rates Decline, Hoteliers Levy New, Higher Fees, Says NYU's Hanson

Despite a forecast for a continued decline in hotel rates in 2010, hoteliers will become more aggressive in collecting fees and surcharges this year, some of which are proving difficult to bundle into negotiated rates, according to New York University Tisch Center associate professor Bjorn Hanson.

Speaking today at the Business Travel News/National Business Travel Association Strategic Travel Symposium in New York, Hanson projected an increase in total collected fees and surcharges by U.S. hotel companies this year compared with 2009. The total, now well over a billion dollars, has steadily increased over the past decade.

Fees pose a budgeting problem for travel buyers because they are difficult to anticipate and vary even among hotels under the same brand flag, Hanson said.

"You could stay at a Marriott, Starwood or Hilton hotel one night, and stay at a different Marriott, Starwood or Hilton hotel the next night, and the fees and surcharges will be different," he said. "These are hotel by hotel, and they also come and go."

In particular, hotels are adding charges to hold travelers' bags after they check out, extra room service charges and increased or stricter cancellation and early checkout fees. On the group business side, Hanson noted a growth in master folio charges, audiovisual charges and set-up and breakdown fees for meeting rooms.

Hotels also are upping charges for such business services as received faxes to as high as more than $5 for the first page, he said. This stems from a trend of hotels outsourcing their business center operations due to declining demand.

To add to the challenge, buyers often are not able to negotiate these fees because of technology limitations at the hotel. "It's really hard for hotels to bundle some services in corporate rates because the property management systems don't allow them to do accounting that way," Hanson said.

At the same time, Hanson said buyers are being more aggressive and successful in negotiating high-demand business travel amenities, such as Internet access, parking and breakfast.