Global Hotel Rates to Stabilize in 2025 Amid New Openings and Eased Inflation: Amex GBT Report

The American Express Global Business Travel (Amex GBT) Hotel Monitor report predicts that while hotel rates globally are set to rise in 2025, the increase will be notably slower than in previous years. This moderation is attributed to a combination of factors, including a surge in new hotel openings and a global easing of inflation pressures, which have impacted hospitality over the past several years. Covering 80 major cities worldwide, the report provides a detailed look at trends, regional forecasts, and how the hospitality landscape is evolving.

In North America, New York is anticipated to lead rate increases at 4.7%, a reflection of its high demand and a regulatory block on short-term rentals. Mexico City (4.5%) and Las Vegas (4.2%) follow closely behind, underscoring continued demand in high-traffic tourism hubs. Canadian cities are projected to see more moderate price hikes, with Calgary and Montreal at 3.2%, Ottawa and Toronto at 3.1%, and Vancouver with a comparatively lower rise of 2.9%. This stability reflects a favorable hotel construction trend in Canada, which has seen a 54% increase in new projects year-over-year and anticipates 37 new hotel openings in 2025 alone.

Across Europe, the report forecasts modest rate increases, largely under 5%, consistent with North America’s trends. This stabilization aligns with the International Monetary Fund’s outlook for lower global inflation in 2025, though higher labor costs and wage pressures are expected to keep hotel rates relatively elevated. Cities in India are forecasted to have some of the most substantial rate increases globally, with Mumbai and Delhi expecting rises of around 8.5-9% as the country’s economy continues its rapid expansion.

In Africa, inflation remains a pressing challenge for several nations. Destinations such as Lagos in Nigeria are projected to see hotel rates surge by 13.4%, while Cairo in Egypt will see increases of around 11.9%. By contrast, China’s major cities such as Beijing and Shanghai are set for milder price hikes, with Beijing at 2% and Shanghai at 1.6%, indicative of the country’s relatively stable economic conditions and expanding hotel supply.

Transformative Trends in Hospitality:

The Amex GBT report highlights several trends reshaping the hospitality sector. Hotels are increasingly turning to technology, with artificial intelligence (AI) and smart room tech transforming operations. AI-driven tools help streamline tasks like room assignments, freeing staff to focus on personalized guest experiences. Meanwhile, smart room technology allows guests to control their environment, offering a customized experience that is both efficient and appealing, especially to tech-savvy travelers.

Sustainability is another priority, with hotels investing in data systems that allow them to monitor and report their environmental impact more effectively. Meeting corporate sustainability goals has become essential for hotels working with eco-conscious travelers and corporate clients.

Extended-stay properties, particularly apartment-style hotels, are gaining popularity globally, especially in Asia, where they cater to the growing demand for longer, more flexible travel options. This shift reflects changing travel patterns as more individuals and corporate clients opt for stays that blend work and leisure.

As travel buyers navigate this stabilized yet elevated pricing environment, Amex GBT recommends creative sourcing strategies to manage costs. “Keeping an open mind on dynamic rates and leveraging TMCs’ negotiated rate programs in secondary and tertiary cities can offer buyers greater value,” said Dan Beauchamp, VP of Consulting at Amex GBT. These strategies may prove essential in adapting to the evolving landscape and achieving budget efficiency without compromising travel quality.

Overall, 2025’s anticipated rate stabilization signals a positive shift for the global travel sector, presenting both challenges and opportunities for travelers and the hospitality industry alike.