Hotel Rate Growth to Vary by Market in 2027

Hotel rates are expected to rise in 2027, but growth will vary by market according to American Express Global Business Travel's 'Hotel Monitor 2027' study. Business travel and meetings are anticipated to support demand in the Americas and Europe, while inflation and the Middle East conflict could limit growth in some markets.

The report forecasts higher hotel rates in several major markets, including São Paulo, which is expected to see the largest increase at 10.9 to 12.2 percent, followed by Buenos Aires at 8.1 to 8.7 percent and Madrid at 6.1 to 9.2 percent.

In contrast, hotel rate growth in India is expected to slow from recent years due to increased supply. Bengaluru is forecast to see hotel rates increase 5 to 5.5 percent. The report also notes that hotel supply is improving in India, with most major global hotel chains now present in the country.

Dubai is forecast to see growth of just 1 to 2 percent as the Middle East conflict continues to affect demand. Hotel occupancy in the UAE fell to 19.6 percent in March before recovering to between 40 and 50 percent, according to a recent report by NYU's Tisch Center of Hospitality, RateGain and HEDNA.

This year's forecast reveals a nuanced global environment where geopolitical uncertainties and commodity price volatility are shaping hotel rates in different ways across regions, said Sara Andell, Amex GBT, director of consulting strategy.