H&LA’s David Sangree and Anthony DiPonio were among the more than 2,200 hospitality professionals, investors, developers, and brand executives who descended on New York City for the NYU International Hospitality Investment Forum — and here are their top five takeaways.
- Hotel Performance Is Stronger Than Previous Projections
Despite early signs of weakening performance coupled with ongoing cost pressures, the U.S. hotel industry is exceeding earlier expectations. CoStar and Tourism Economics project ADR gains of 1.0% and RevPAR gains of 2.2% and now expect occupancy to grow rather than decline. This is driven by stronger demand from both group and transient segments, with room demand up more than eight million room nights year over year through April. Booking.com’s conference presentation reported that 75% of their customers expressed optimism about travel in 2026.
- AI Is Reshaping Hotels and How Guests Find Them
AI dominated conference floor conversations, and the discussion has matured well beyond hype. Hotels are deploying AI across revenue management, guest communications, security, and sales initiatives. AI has rapidly become one of the fastest-growing tools travelers use to research and plan trips, increasingly influencing destination discovery and hotel selection. This creates a new imperative of ensuring properties are visible not just on traditional OTAs, but in the AI-driven discovery environment and social media algorithms that are quickly influencing how people travel.
- Financing
Speakers noted that access to capital remains a significant constraint, with elevated interest rates and tighter lender underwriting making deal financing more challenging across the board. That said, the market is not monolithic. It was noted that better-performing luxury hotel assets continue to attract strong investor interest, with capitalization rates at 5%. Cap rates for more typical hotels are closer to 8.5%, which reflects a higher risk profile and tighter debt availability.
- Doing Deals
Transactions are still happening, but the bar has risen. A recurring question among panelists was: will someone buy this when it’s built? Beyond fundamentals, a meaningful influx of new capital — family offices, non-traditional equity, and international investors — is actively seeking the right opportunities. Brands continue to add measurable value by bringing distribution, loyal customers, and lender confidence to deals.
- New Development Challenges
Multiple speakers across panels and general sessions reached the same conclusion: ground-up hotel development is harder than it has been in over a decade. Sharply higher construction costs, elevated interest rates, and a more cautious lender and investor community are compounding challenges, particularly for full-service and mixed-use projects. Developers still moving forward are doing so with more equity, tighter scopes, or creative structures like conversions and adaptive reuse.
AUTHORS
David J. Sangree, MAI, CPA, ISHC is President of Hotel & Leisure Advisors (H&LA), an international hospitality consulting firm specializing in appraisals, feasibility studies, impact analyses, economic impact studies, and litigation support for the lodging, waterpark, and leisure industries. David is an internationally recognized expert on waterpark resorts and has completed more than 1,000 studies of indoor and outdoor waterparks. He was named one of Aquatics International Magazine’s “2019 Power People,” inducted into the World Waterpark Association Hall of Fame in 2022, and received their Executive Board Award in 2016. He has appeared on Good Morning America and CNBC and has written articles for numerous publications. He can be reached at 216-810-5800 or dsangree@hladvisors.com.
Anthony DiPonio, CHIA is an Associate at H&LA who brings hands-on hospitality operations experience and analytical expertise to appraisals, feasibility studies, and economic analyses across the lodging, waterpark, and leisure industries. Prior to joining H&LA, he held leadership roles at eight hotels throughout the Midwest, including serving as Director of Hotel Operations at the Element Hotel in Detroit. He can be reached at adiponio@hladvisors.com or 216-403-1743.