.png)
The Americas Lodging Investment Summit (ALIS) kicked off last week in Los Angeles, reflecting the optimism and challenges the industry faces as it heads into 2025, reports correspondent Stacy Silver.
Industry Optimism vs. Economic Headwinds: A Balancing Act for 2025
The Boardroom Outlook: Roadmap for the Future panel made up of Geoff Ballotti, president and CEO of Wyndham Hotels & Resorts; Anthony Capuano, president and CEO of Marriott International; Elie Maalouf, CEO of IHG Hotels & Resorts; Jean-Jacques Morin, deputy CEO of Accor; Chris Nassetta, president and CEO of Hilton; and Craig Smith, CEO of Aimbridge discussed their growth trajectories and development pipelines for 2025. Despite facing inflationary pressures, rising labor costs, and potential tariff concerns, they expressed optimism about the industry's ability to continue driving strong performance.
Record-Breaking Growth: Hilton, Marriott, and the Future of Development
Hilton reported its largest increase in history, adding nearly 100,000 rooms in 2024, while Marriott unveiled a record 123,000 room openings. With strong growth and continued consumer demand, the executives remain optimistic as they navigate both opportunities and challenges in 2025. They did acknowledge several factors that could affect growth in the short term. Labor shortages continue to be a major concern, as do discussions surrounding immigration and its potential impact on the hospitality workforce.
The High Cost of Capital: How Financing Constraints Are Reshaping Hospitality Deals
Rising concerns about the availability of debt and increased construction costs have slowed down shovel-ready projects. Interest rates remain high, and while the Federal Reserve has made some cuts recently, many executives, including those at Gulph Creek Hotels, anticipate that rates will stay elevated for longer than originally expected. Emily Johnson, VP of Development at Gulph Creek Hotels, explained, "The high cost of capital will continue to be the biggest challenge for us in 2025. Even with some stabilization, financing remains expensive, impacting acquisitions, development, and even property-level decision-making. Navigating this environment requires disciplined underwriting and a strategic approach to branding and positioning."
Extended-Stay & Select-Service Hotels: The Smart Money Bet for 2025
Johnson also pointed out that select-service and extended-stay hotels will likely see the most deal flow in 2025, particularly in secondary and tertiary markets, where demand remains consistent and stable. She added that conversion opportunities—such as repositioning older hotels into extended-stay properties—are also expected to increase.
Group Travel and Luxury Leisure: Demand Drivers Hoteliers Are Banking On
Allison Handy, EVP of Commercial at Aimbridge, echoed this sentiment by highlighting that group travel would continue to be a crucial driver of performance in the coming year. "While business travel remains unpredictable, group travel—whether it's for conferences, sporting events, or other large gatherings—will be a key focus for midscale and upper-upscale hotels."
Handy's biggest challenge this year will be managing the right mix of business across all channels and segments to achieve an optimal ADR. "It's about staying ahead and being prepared to shift strategies. Anticipating what is coming and being proactive to drive share early, rather than being reactive and trying to gain it back." She also sees luxury leisure as a segment poised for growth, driven by Baby Boomers who continue to prioritize travel as they retire. This trend toward family and generational travel will provide a strong demand for higher-end, leisure-focused properties. Independent hotels, in particular, are expected to benefit from a growing trend of customized consumer marketing and social influencers promoting unique travel experiences.
Caroline MacRae, Senior Analyst at Peachtree Group, feels that the primary challenge remains the elevated cost of capital. "We are stuck in a market where interest rates have been staying higher for longer, and our company is leaning into our credit vehicle to capitalize on it. The market rate dip people were projecting isn't there, and the market is still dislocated between buyers and sellers," she explained. MacRae added that while CMBS debt is currently in the 6-6.5% range, construction lending, while available, is mostly through the private sector. She sees extended-stay properties continuing to attract investment due to their strong operating margins and resilience, even in a higher-cost environment. "We're used to seeing a lot of acquisitions, and lately, everything we've seen has been a refi. We're seeing full-service and limited-service hotels being refinanced, while development has been mostly extended stay, which has been a more active space."
Personal Growth + Leadership: Industry Executives Set Their 2025 Goals
On a personal level, Johnson, Handy, and MacRae shared their goals for 2025, reflecting their commitment to professional growth and drive to contribute meaningfully to the industry. Johnson is focused on scaling Gulph Creek's management platform, deepening relationships within the company, and continuing to mentor emerging talent. "I am committed to fostering a strong, collaborative environment within Gulph Creek, ensuring our team has the resources and support to thrive. Additionally, I want to continue engaging with industry leaders, speaking at events, and mentoring the next generation of hospitality professionals."
Handy's goals center on building stronger relationships with Aimbridge's property teams. She wants to be more intentional in engaging with the teams on the front lines. They have firsthand knowledge of "how travelers' preferences and behaviors are changing and how they are spending their time and money. I also have a strong desire to show more personal gratitude to our teams delivering hospitality to our guests and learning from them in a more intentional way in 2025."
MacRae's goals for 2025 revolve around growing her network and forging deeper connections within the hospitality industry. "I look at upper management and see them working on deals with people they met back when they were in my position in their career. Through these connections, I want to bring in business and hopefully originate a deal of my own," she explained. By expanding her professional network, MacRae hopes to contribute more significantly to Peachtree Group's growth and development while advancing her career within the industry.
Honoring Hospitality Trailblazers: Recognizing Impact and Innovation at ALIS
Several individuals were also honored at the conference for their outstanding contributions to the hospitality industry.
Amanda Hite, president of STR, a CoStar Group company, was the 2025 Shatterproof Hospitality Heroes honoree. Hite was recognized for her courage and dedication to raising awareness about substance use disorders and challenging the stigma surrounding addiction. The event raised over $2M for Shatterproof's mission to transform addiction treatment across America.
Lauren McCann and Jen Collins, co-founders of Procure Impact, were honored by the AHLA Foundation and the BHN/Northstar Travel Group team with the Arne Sorenson Social Impact Leadership Award. In 2024, Procure Impact and AHLA members teamed up to launch the Dignity of Work Pledge to source goods responsibility and create 100,000 hours of paid employment for people with barriers to work. Procure Impact, and AHLA announced the goal was reached thanks to 23 hospitality companies that pledged over $7.4 million in purchases. The Arne Sorenson Social Impact Leadership Award was introduced in 2022 to honor Arne Sorenson, former President and CEO of Marriott, who passed away.