Targeting Profitable Hospitality Ventures in 2026

Listen to the article 17 minutes This audio is auto-generated. Please let us understand if you have feedback. Following a year of broad financial uncertainty that stifled growth for hotels, hospitality market leaders are looking towards 2026 with cautious optimism. Increasing operational costs are slated to challenge owners this year and lower-tier sections might have a hard time in the middle of a growing wealth bifurcation.

And through everything, hotel companies are anticipated to strengthen their portfolios with brand-new brand offerings and collaborations. As the year gets underway, Hotel Dive spoke with hospitality leaders from differing corners of the market about their 2026 forecasts. Below are the leading trends expected to effect hotel operations, efficiency, net system growth and more this year.

Total salaries, wages and benefits paid by U.S. hotels rose to $127 billion in 2025, according to information from the American Hotel & Accommodations Association, shown Hotel Dive. In 2026, that figure is forecasted to reach $131 billion, representing a roughly 3% year-over-year increase, per AHLA. For hotel owners, increasing labor expenses position an obstacle to net operating earnings development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

Key Regional Milestones in Brand Expansion

Rising labor costs have been a challenge for hoteliers for years, Davis said, particularly following the COVID-19 pandemic. In general, hotel labor expenses have actually increased 15.3% from 2019 to 2025, outmatching the 12.8% development in overall operating income, according to AHLA.

3, 2024 in San Francisco, California. Justin Sullivan via Getty Images In 2026, Davis noted, union settlements will be "front and center" in New york city City, where the New York Hotel and 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 speed," she said. Incomes, incomes and payroll-related costs paid by hotels now account for more than 32% of total income, according to AHLA.

Top Lucrative Investment Opportunities for 2026

As more hotel guests turn to artificial intelligence to enhance their travel experience, scheduling hotels directly through big language models (LLMs) might be next, hospitality professionals stated. Agentic commerce a procedure by which autonomous AI agents act on behalf of a consumer to discover, compare and finish purchases is a trend that has sped up throughout industries like retail.

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According to PwC's 2025 Vacation Outlook report, 76% of millennials said they're most likely to use AI for travel suggestions. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, told Hotel Dive. Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct reservation, bigger 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 results page which numerous brands aren't, and this is the big 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 product marketing at AI consumer experience platform Talkdesk, similarly informed Hotel Dive that hospitality gamers require to guarantee their home details is being indexed by LLMs to appear in tourist queries.