Why Hospitality Brand Value Will Be Surging

Listen to the post 17 min This audio is auto-generated. Please let us know if you have feedback. Following a year of broad economic uncertainty that stifled development for hotels, hospitality industry leaders are looking towards 2026 with cautious optimism. Increasing functional costs are slated to challenge owners this year and lower-tier sectors might have a hard time in the middle of a growing wealth bifurcation.

And through all of it, hotel companies are expected to strengthen their portfolios with new brand offerings and partnerships. As the year gets underway, Hotel Dive spoke with hospitality leaders from differing corners of the industry about their 2026 predictions. Below are the top trends anticipated to impact hotel operations, efficiency, net unit growth and more this year.

Overall wages, salaries and advantages paid by U.S. hotels rose to $127 billion in 2025, according to information from the American Hotel & Accommodations Association, shared with Hotel Dive. In 2026, that figure is predicted to climb to $131 billion, representing an approximately 3% year-over-year boost, per AHLA. For hotel owners, increasing labor expenses posture 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 costs have been a challenge for hoteliers for years, Davis said, especially following the COVID-19 pandemic. Overall, hotel labor costs have actually increased 15.3% from 2019 to 2025, surpassing the 12.8% development in total operating earnings, according to AHLA. In the last few years, thousands of union hotel workers have actually gone on strike demanding greater salaries in order to keep up with the rising cost of living in places such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan by means of Getty Images In 2026, Davis noted, union settlements will be "front and center" in New York 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 speed," she stated. Incomes, earnings and payroll-related costs paid by hotels now account for more than 32% of overall revenue, according to AHLA.

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As more hotel guests turn to synthetic intelligence to enhance their travel experience, booking hotels directly through large language models (LLMs) might be next, hospitality specialists stated. Agentic commerce a procedure by which autonomous AI agents act upon behalf of a consumer to find, compare and finish purchases is a trend that has accelerated throughout industries like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials said they're most likely to use AI for travel recommendations. 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 stay competitive with direct reservation, larger multibrand hotel companies will "embed LLMs into their own brand websites and mobile apps, and change the method the consumer searches," Kletzel said.

"If you are not discoverable in an LLM search result 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 stated. Michael Klein, head of retail, travel and hospitality product marketing at AI consumer experience platform Talkdesk, likewise informed Hotel Dive that hospitality gamers require to ensure their property info is being indexed by LLMs to appear in tourist inquiries.