Lodging Conference: ADR up 3.7%, AI reshapes bookings

Global Hotel Performance Shows Resilience

The global hotel sector demonstrates resilience in 2026, with executives at the Lodging Conference expressing optimism despite ongoing geopolitical and economic pressures. Isaac Collazo, Senior Director of Analytics at STR, reported that average daily rate (ADR) increased by 3.7% year-over-year for the year to date.

This growth, which outpaced inflation, was partly boosted by the summer’s World Cup tournament. Excluding June and July, ADR saw a rise of approximately 2.9% year-over-year. While overall revenues improved, Collazo noted that "undistributed expenses are growing slightly faster," which continues to constrain profit margins.

Bernie Baumohl, Chief Global Economist at The Economic Outlook Group, affirmed the industry's "fairly good shape," citing strong hotel demand against limited supply. Baumohl attributed the United States economy's ability to absorb volatility partly to investments in artificial intelligence and sustained consumer spending.

Artificial Intelligence Reshapes Guest Engagement

Artificial intelligence (AI) is fundamentally altering the hotel industry, with Shai Zelering, Managing Partner of Brookfield's Real Estate Group, describing it as the "second greatest change" after the digital revolution.

Keith Pierce, Co-CEO of Sonesta International Hotels, stated that AI represents a "paradigm shift" that will influence how guests search for and book properties, posing a significant disruption to online travel agencies (OTAs). This shift also affects how marketers allocate spending and how brands present themselves.

Craig Smith, CEO of Aimbridge Hospitality, observed that AI consultants are evenly divided on whether OTAs or hotel brands will ultimately lead in travel search.

Ryan Rivett, President and CEO of My Place Hotels, highlighted AI's capacity to convert a simple room transaction into a more personalised "relational narrative," allowing guests to find properties based on specific preferences rather than generic criteria. The initial impact of these changes is expected to begin with leisure travellers.

Outdoor Hospitality Gains Momentum

The unconventional hospitality market, encompassing glamping and cabin stays, continues its expansion as consumers increasingly seek distinctive nature-based experiences.

Brad LeBlanc, Senior Vice President and Chief Development Officer at BWH Hotels, observed that a "new generation of travellers" has altered travel behaviour, contributing to the growth of outdoors-focused accommodation.

Leon Fisher, Chief Sales Officer at Zook Cabins, which constructs Amish-style log cabins and tiny homes, explained that younger travellers desire immersive engagements and nature-inspired amenities not typically found in conventional hotels.

These guests aim to "spread out, immerse themselves in the outdoors and nature while being in the cabin [and] having that campfire experience at nighttime."

Asia's Travel Sector to Reflect Global Trends

The trends discussed at the Lodging Conference will resonate across Asia's diverse travel markets.

The increasing adoption of artificial intelligence in booking and guest interactions is likely to be mirrored by major Asian hotel groups and online travel agencies, such as Trip.com Group or Accor in the region, as they refine their digital strategies to meet evolving consumer expectations for personalised services.

This could drive further investment in AI tools to enhance search capabilities and guest experiences. Similarly, the growing demand for unique, nature-focused stays, evidenced by the expansion of glamping and eco-lodges across Southeast Asia and East Asia, suggests continued opportunities in these niche segments.

However, Asian operators will also need to manage persistent cost growth and limited pricing power, as noted by STR, requiring careful operational efficiency to maintain profitability in a competitive environment.