AHHOA's Chip Rogers Offers Insights into Next Year's Hospitality Trends
The overall picture for the industry will continue to be rosy, but labor will be the biggest challenge facing hoteliers.
For a look at next year's trends, HX: The Newsletter Editor Laura Koss-Feder spoke with AAHOA President and Chief Executive Officer Chip Rogers - who has his finger on the pulse of the hospitality industry and is carefully watching how the economy will impact lodging in 2019. Rogers is also a member of the HX Advisory Board.
Q. Where do you see the hotel industry's performance headed next year?
A. It has been a historic run, and I don't see anything that will derail this. Demand will continue to outweigh supply and occupancies will remain strong. ADR and RevPAR will continue to improve year after year. Since disposable income is higher than it has been in the past, people will have money to travel and spend at hotels.
Q. How will investment in the hotel industry play out in 2019?
A. We hear information that private equity funds are happy with returns from the hospitality industry. Based on this, they will invest next year at a similar pace. High land costs may impact some construction, even though developers have more money to spend because of the tax cuts that have been put in place. The tax savings will ultimately, I hope, outweigh the cost of land.
Q. Even with a healthy forecast for next year, what concerns do you have for the industry?
A. The cost of labor and availability of good labor will continue to be an issue. I don't see this going away any time soon. We have had the biggest wage growth in decades, and that puts pressure on the bottom line.
Q. What will we see in hotel technology next year?
A. Consumers want high-speed Internet access. They want the same connectivity that they have at home. There also will be more mobile technology. We will see new technological options for limited-service brands. In some cases, technology will help with open positions in hotels that just can't be filled. And, this will assist in enhancing the guest experience as well next year.
Q. What about a trade war- how could that impact hotels?
A. We could see items like metal being more expensive for next year. This could make new construction pricier, and these costs would ultimately be passed in some way on to the consumer.
Q. How will hotel franchisor/franchisee relationships evolve in 2019?
A. Based on a new ruling, we should go back to the traditional model, where the employees of a franchised hotel or other kind of franchised business are just employees of that business only - and not of the franchisor as well. This is very important. Franchised businesses should have total control over their employees. That is what has always made the most sense to hoteliers.
Chip Rogers is at the helm of AAHOA, the Atlanta-based nation’s largest hotel owners association. During his tenure, AAHOA has established association records for membership, lifetime membership, event attendance, PAC fundraising, and revenue. Rogers also serves as a member of the Forbes Nonprofit Council, the California State University Hospitality & Tourism Management Education Alliance Advisory Panel, member of the American Legislative Exchange Council Private Enterprise Advisory Board, member of the Board of Directors California Hotel and Lodging Association, and the Board of Directors for Community Leaders of America. He previously served in the Georgia General Assembly, being elected six times. In addition, he was unanimously elected to serve two-terms as the Senate Majority Leader.