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, hospitality industry leaders are looking toward 2026 with cautious optimism. Rising operational expenses are slated to challenge owners this year and lower-tier sections could have a hard time amid a growing wealth bifurcation.

And through it all, hotel companies are expected to strengthen their portfolios with new brand offerings and collaborations. As the year gets underway, Hotel Dive spoke with hospitality leaders from differing corners of the market about their 2026 forecasts. Below are the leading patterns expected to effect hotel operations, performance, net system development and more this year.

Overall incomes, earnings and benefits paid by U.S. hotels rose to $127 billion in 2025, according to data from the American Hotel & Accommodations Association, shown Hotel Dive. In 2026, that figure is predicted to reach $131 billion, representing a roughly 3% year-over-year boost, per AHLA. For hotel owners, increasing labor expenses position an obstacle to net operating income growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

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Rising labor costs have been a difficulty for hoteliers for years, Davis stated, especially following the COVID-19 pandemic. In general, hotel labor costs have actually increased 15.3% from 2019 to 2025, exceeding the 12.8% development in total operating revenue, according to AHLA.

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

"Need has not kept up with this rate," she said. "We're also seeing these challenges compounded by legislation that targets hotel operations, such as severe labor and licensing policies like the New York City Safe Hotels Act. When need is falling and expenses are soaring, the mathematics simply doesn't build up." Wages, earnings and payroll-related expenditures paid by hotels now represent more than 32% of overall revenue, according to AHLA.

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As more hotel visitors turn to synthetic intelligence to enhance their travel experience, reserving hotels directly through big language models (LLMs) might be next, hospitality professionals said. Agentic commerce a process by which self-governing AI agents act upon behalf of a customer to find, compare and finish purchases is a trend that has actually accelerated across industries like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials said they're likely to use AI for travel suggestions. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, told Hotel Dive. Michael Klein Head of retail, travel and hospitality item marketing at Talkdesk To stay competitive with direct booking, bigger multibrand hotel business will "embed LLMs into their own brand name websites and mobile apps, and change the method the customer searches," Kletzel stated.

"If you are not visible in an LLM search engine result which numerous brands aren't, and this is the huge 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, likewise informed Hotel Dive that hospitality gamers need to guarantee their property details is being indexed by LLMs to appear in traveler questions.