Identifying High-ROI Business Ventures in 2026

Listen to the post 17 min This audio is auto-generated. Please let us know if you have feedback. Following a year of broad financial unpredictability that stifled growth for hotels, hospitality industry leaders are looking toward 2026 with cautious optimism. Increasing functional expenses are slated to challenge owners this year and lower-tier segments could struggle in the middle of a growing wealth bifurcation.

And through everything, hotel companies are expected to strengthen their portfolios with brand-new brand name offerings and partnerships. As the year gets underway, Hotel Dive spoke with hospitality leaders from differing corners of the industry about their 2026 predictions. Below are the top patterns anticipated to effect hotel operations, performance, net unit development and more this year.

Overall incomes, incomes and benefits paid by U.S. hotels rose to $127 billion in 2025, according to data from the American Hotel & Lodging Association, shown Hotel Dive. In 2026, that figure is predicted to reach $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, increasing labor costs position a challenge to net operating income growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

How to Scale a Restaurant Group Rapidly

"It is an outright concern." Rising labor expenses have actually been an obstacle for hoteliers for many years, Davis said, especially following the COVID-19 pandemic. In general, hotel labor expenses have increased 15.3% from 2019 to 2025, surpassing the 12.8% development in total operating profits, according to AHLA. In recent years, thousands of union hotel workers have actually gone on strike demanding higher salaries in order to stay up to date with the increasing expense of living in places such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan via Getty Images In 2026, Davis kept in mind, union settlements will be "front and center" in New York City, where the New York Hotel and Video gaming Trades Council's union agreement with the Hotel Association of New York City is set to end in July.

"Demand has not kept up with this rate," she stated. "We're also seeing these obstacles intensified by legislation that targets hotel operations, such as severe labor and licensing policies like the New York City Safe Hotels Act. When demand is falling and expenses are skyrocketing, the mathematics simply does not accumulate." Salaries, salaries and payroll-related expenses paid by hotels now account for more than 32% of overall revenue, according to AHLA.

Expert Methods to Increase Market Share via Expansion

As more hotel visitors turn to artificial intelligence to boost their travel experience, reserving hotels straight through large language designs (LLMs) may be next, hospitality professionals stated. Agentic commerce a process by which autonomous AI representatives act upon behalf of a consumer to discover, compare and complete purchases is a pattern that has accelerated throughout markets like retail.

Freddy's Frozen Custard & Steakburgers

According to PwC's 2025 Vacation Outlook report, 76% of millennials stated they're most likely to utilize AI for travel suggestions. That number is growing, Jonathan Kletzel, PwC's travel, transport and logistics leader, told Hotel Dive. Michael Klein Head of retail, travel and hospitality item marketing at Talkdesk To stay competitive with direct booking, larger multibrand hotel companies will "embed LLMs into their own brand name websites and mobile apps, and change the way the consumer searches," Kletzel stated.

"If you are not discoverable in an LLM search result which many brands aren't, and this is the huge panic that they're all going through today customers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality product marketing at AI customer experience platform Talkdesk, similarly told Hotel Dive that hospitality gamers need to guarantee their home details is being indexed by LLMs to appear in tourist questions.