»»High-end Hotels Losing Corporate Business
As business travel is continuing to decline, data on premium airline traffic and high-end hotels occupancy show that the luxury travel segment is being hit hard.
The New York Times cited data from Smith Travel Research showing that in October luxury hotels saw the biggest drops in room rates, revenues and occupancy rates compared with any other hotel segment.
“For example, occupancy rates fell 8.9 percent and average daily room rates fell by 3.9 percent at the luxury level. By comparison, occupancy dropped 6.8 percent while room rates increased by 1.1 percent at midscale properties” (source).
The newspaper says high-end hotels have been losing corporate business, not just because of shrinking business travel budgets but also because many corporations don’t want to be perceived as being ostentatious in today’s economic environment.
“Luxury hotels and meeting planners say the trend started after a subsidiary of American International Group was castigated for hosting a $442,000 conference at a luxurious Southern California resort days after a federal bailout. A.I.G. subsequently canceled a gathering at the Ritz-Carlton Half Moon Bay as well as other company meetings.
Concerned about shareholder and public perception, other companies are moving conferences from luxury resorts to more modest sites, selling private jets and canceling meetings“
As high-end hotels are turning to third-party websites in the effort to fill the empty rooms, it is the perfect time to get deals when looking for luxury suites.
