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Listen to the post 17 minutes This audio is auto-generated. Please let us know if you have feedback. Following a year of broad economic uncertainty that stifled growth for hotels, hospitality industry leaders are looking towards 2026 with cautious optimism. Increasing operational expenses are slated to challenge owners this year and lower-tier segments might struggle amidst a growing wealth bifurcation.

And through it all, hotel companies are anticipated to fortify their portfolios with brand-new brand name offerings and collaborations. As the year gets underway, Hotel Dive spoke with hospitality leaders from varying corners of the market about their 2026 forecasts. Below are the top trends anticipated to impact hotel operations, efficiency, net system development and more this year.

Total incomes, incomes 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 forecasted to climb to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, rising labor expenses present a difficulty to net operating earnings development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

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Rising labor expenses have actually been a difficulty for hoteliers for years, Davis said, especially following the COVID-19 pandemic. Overall, hotel labor costs have increased 15.3% from 2019 to 2025, exceeding the 12.8% growth in overall operating profits, 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, where the New York Hotel and Video gaming Trades Council's union contract with the Hotel Association of New York City City is set to end in July.

In 2015, the union backed New york city City's freshly chosen Mayor Zorhan Mamdani, who operated on a guarantee to raise New york city City's base pay to $30 per hour by 2030. Hotel market associations, including AHLA, have knocked similar legislation throughout the country, including the just recently passed $30 wage ordinance in Los Angeles. "Demand has not kept up with this pace," she said. Incomes, incomes and payroll-related expenditures 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 synthetic intelligence to improve their travel experience, reserving hotels straight through big language models (LLMs) might be next, hospitality specialists stated. Agentic commerce a process by which autonomous AI agents act on behalf of a consumer to find, compare and finish purchases is a trend that has sped up across markets 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 likely to utilize it for reserving travel. However that number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, informed Hotel Dive. "The variety of consumers that are searching [by means of LLMs] for services and products in travel has actually ballooned in the last 12 months and is speeding up every day," Kletzel stated, adding that inevitably, hotels will "take a difficult look at how they can make it possible for commerce and deals through agentic [AI]"" [Brands] can construct on the trust they currently have if they do a great job with how they manage AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct booking, bigger multibrand hotel companies will "embed LLMs into their own brand sites and mobile apps, and alter the way the consumer searches," Kletzel said.

"If you are not discoverable in an LLM search engine result which many brand names aren't, and this is the big panic that they're all going through today consumers aren't going to consider you," he stated. Michael Klein, head of retail, travel and hospitality product marketing at AI client experience platform Talkdesk, similarly informed Hotel Dive that hospitality players need to ensure their property details is being indexed by LLMs to appear in tourist inquiries.