As the corporate negotiation season progresses, hotel executives are reporting that they are seeing year-over-year increases in rates thus far. The percentage of rate growth is decreasing on a year-over-year basis, however, as economic uncertainty continues.
There were differences in expectations between hotel industry leaders and corporate travel managers. Hotel industry leaders were expecting corporate contract rates for 2013 to increase by a national average of 7 to 9 percent. Corporate travel managers were planning for increases of 3 to 5 percent. Preliminary estimates are that negotiations will result in an average 5 to 6.5 percent increase in rates.
One response to higher rates is the reallocation of corporate contracts from luxury and upper-upscale hotels to upscale, select-service and limited-service hotels.
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