The Outlook of Global Corporate Expansion Milestones

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 development for hotels, hospitality market leaders are looking toward 2026 with cautious optimism. Rising functional costs are slated to challenge owners this year and lower-tier sectors might struggle in the middle of a growing wealth bifurcation.

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

Overall wages, incomes and advantages paid by U.S. hotels increased to $127 billion in 2025, according to information from the American Hotel & Accommodations Association, shared with Hotel Dive. In 2026, that figure is forecasted to climb up to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, rising labor costs pose an obstacle to net operating earnings growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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"It is an absolute issue." Rising labor expenses have been a difficulty for hoteliers for several years, Davis said, particularly following the COVID-19 pandemic. In general, hotel labor costs have increased 15.3% from 2019 to 2025, exceeding the 12.8% growth in total operating income, according to AHLA. Over the last few years, countless union hotel employees have actually gone on strike requiring greater wages in order to stay up to date with the increasing cost of living in places such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan through Getty Images In 2026, Davis noted, union settlements will be "front and center" in New york city City, where the New York City Hotel and Video gaming Trades Council's union contract with the Hotel Association of New York City is set to expire in July.

"Need has not kept up with this rate," she stated. Wages, wages and payroll-related expenses paid by hotels now account for more than 32% of total revenue, according to AHLA.

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As more hotel visitors turn to artificial intelligence to boost their travel experience, scheduling hotels directly through large language models (LLMs) might be next, hospitality specialists stated. Agentic commerce a procedure by which self-governing AI agents act upon behalf of a customer to discover, compare and finish purchases is a pattern that has actually sped up throughout industries like retail.

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According to PwC's 2025 Holiday 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, informed Hotel Dive. Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To stay competitive with direct reservation, larger multibrand hotel companies will "embed LLMs into their own brand sites and mobile apps, and change the way the customer searches," Kletzel said.

"If you are not visible in an LLM search engine result which many brand names aren't, and this is the huge panic that they're all going through right now customers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality item marketing at AI consumer experience platform Talkdesk, similarly informed Hotel Dive that hospitality gamers require to ensure their home information is being indexed by LLMs to appear in traveler queries.