NEW YORK June 6, 2005 - Renewed growth of domestic business travel (51 percent) and pent-up demand (27 percent) are the prime factors fueling faster than anticipated recovery of the U.S. hotel industry back to 2000 levels, according to a survey of senior executives attending New York University’s 27th Annual International Hospitality Industry Investment Conference, being held this week in New York City.

More than half of survey respondents expect this upward trend to continue for at least two more years; an even more optimistic 20 percent predicts three more years of sustained growth. Threat of terrorism (27 percent) and rising energy costs (18 percent) are the top identified external threats to this trend.

Underscoring the current reality, more than half (52 percent) believes a “condo/residential use component” will be included in new hotel investment for at least the next five years.

Sponsored by the NYU Preston Robert Tisch Center for Hospitality, Tourism and Sports Management, the Conference is the largest of its kind focused on the real estate, finance and development sectors of the hotel and travel industries. This year, attendance will hit a record level of almost 1,700 attendees.

Other key findings include:

  • Labor costs (23 percent) and acceleration of new construction (19 percent) identified as the most crucial internal factors affecting hotel industry growth
  • Nearly 7 out of 10 respondents say they were most likely to purchase or sell hotels in the U.S. over the next 18 months; one out of three will most likely purchase or sell outside the U.S. Sixty-one percent will build in the U.S. with 39 percent outside.
  • Among buyer groups, more than one third (36 percent) think REITs (public and private) will be most active during the next 12 months, followed by private equity funds (31 percent) and opportunity funds (17 percent).
  • Seventy percent of the respondents believe the “upper upscale” and “upscale” segments will be most active during the next year mainly in the urban (48 percent) and suburban (33 percent) markets.
  • Half of the respondents believe the Asia/Pacific region will experience the greatest percentage of lodging investment activity over the next five years followed by North America (25 percent).
  • And the winner is ……. Forty two percent thinks Paris will be awarded the 2012 Summer Olympic Games; 31 percent says New York City and 16 percent says London.
  • The power of connecting ……The ‘Blackberry’ is the favorite electronic devise of 42 percent, followed by the cell phone at 22 percent. Eight percent says they hate all electronic devices.

About the Survey
Dr. Lalia Rach, associate dean of the NYU Tisch Center and HVS International Chair, and Dr. Mark Warner, director of graduate programs, with the assistance of graduate students conducted this email survey between April 15 and May 26, 2005. Approximately 11 percent of conference registrants participated.

Forty percent of the respondents describe their focus as “real estate development and investment. More than half (55 percent) have greater than 16 years experience within the hospitality industry. Most respondents (55 percent) conduct hospitality investment activities in the “upper upscale” and “upscale” segments of the industry with 60 percent stating their investment activities were over 100 million USD.

MEDIA ONLY: For more information or to interview Dr. Rach or Dr. Warner, please contact Ken Brown [212 998-9119] or Ellen Evaristo [212 992-9103].

Press Contact

Ken Brown
Ken Brown
(212) 998-9119