Key Global Shifts in Brand Expansion

, hospitality market leaders are looking towards 2026 with careful optimism. Increasing functional costs are slated to challenge owners this year and lower-tier segments might struggle in the middle of a growing wealth bifurcation.

And through everything, hotel companies are expected to fortify their portfolios with brand-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 top trends expected to impact hotel operations, performance, net system growth and more this year.

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

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Increasing labor costs have actually been an obstacle for hoteliers for years, Davis stated, particularly following the COVID-19 pandemic. In general, hotel labor expenses have increased 15.3% from 2019 to 2025, outpacing the 12.8% development in overall operating income, according to AHLA.

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

In 2015, the union backed New York City's newly elected Mayor Zorhan Mamdani, who worked on a promise to raise New york city City's minimum wage to $30 per hour by 2030. Hotel market associations, including AHLA, have actually denounced similar legislation throughout the nation, including the recently passed $30 wage ordinance in Los Angeles. "Need has actually not kept up with this pace," she stated. Incomes, incomes and payroll-related expenses paid by hotels now account for more than 32% of overall profits, according to AHLA.

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As more hotel visitors turn to expert system to boost their travel experience, scheduling hotels directly through large language designs (LLMs) might be next, hospitality specialists stated. Agentic commerce a procedure by which autonomous AI agents act upon behalf of a customer to discover, compare and complete 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 likely to utilize AI for travel suggestions. A smaller sized portion (57%) stated they 'd be most likely to use it for scheduling travel. But that number is growing, Jonathan Kletzel, PwC's travel, transport and logistics leader, told Hotel Dive. "The number of customers that are searching [via LLMs] for items and services in travel has swollen in the last 12 months and is accelerating every day," Kletzel said, including that undoubtedly, hotels will "take a difficult take a look at how they can enable commerce and deals through agentic [AI]"" [Brands] can build on the trust they currently have if they do an excellent task with how they handle AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct reservation, larger multibrand hotel companies will "embed LLMs into their own brand websites and mobile apps, and alter the way the consumer searches," Kletzel stated.

"If you are not discoverable in an LLM search engine result which lots of brand names aren't, and this is the huge panic that they're all going through right now consumers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality product marketing at AI client experience platform Talkdesk, likewise informed Hotel Dive that hospitality players require to ensure their home info is being indexed by LLMs to appear in traveler questions.