UBS Survey Finds Buyers Expect Modest Rate Hikes

Travel managers expect to see hotel rate increases in 2005 of between 1 percent and 3.6 percent, according to results released this week of a survey conducted in late August by UBS Global Equity Research. Of 121 travel managers polled, those who plan to trade down in 2005 to lower-price hotels expect room rates to increase 1 percent, while those who plan to trade up to more expensive hotels expect rate increases of 3.6 percent. Respondents who plan to retain the level of hotel they used in 2004 expect rate increases of 1.9 percent.

"Travel managers surveyed indicated that they expect their hotel spending to rise in 2005. Yet, they expect the percentage of growth, which increased significantly in 2004, compared with the prior year, to moderate in 2005," said William Truelove, UBS lodging industry analyst.

The survey also polled travelers' satisfaction with the hotels chosen for them by their companies. According to Truelove, 11 percent of travel managers reported travelers this year were more satisfied than in 2003 with the hotels' quality and service, while 8 percent of travel managers said travelers were unhappy.