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, hospitality industry leaders are looking toward 2026 with careful optimism. Increasing operational expenses are slated to challenge owners this year and lower-tier sections might struggle amidst a growing wealth bifurcation.

And through everything, hotel business are expected to fortify their portfolios with brand-new brand name offerings and partnerships. As the year gets underway, Hotel Dive spoke with hospitality leaders from differing corners of the market about their 2026 predictions. Below are the leading trends anticipated to impact hotel operations, efficiency, net unit 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 & Lodging Association, shown Hotel Dive. In 2026, that figure is projected to reach $131 billion, representing a roughly 3% year-over-year boost, per AHLA. For hotel owners, rising labor expenses position an obstacle to net operating income development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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Increasing labor costs have been a difficulty for hoteliers for years, Davis said, especially following the COVID-19 pandemic. Overall, hotel labor expenses have actually increased 15.3% from 2019 to 2025, outmatching the 12.8% growth in total operating earnings, according to AHLA.

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

Last year, the union backed New york city City's newly chosen Mayor Zorhan Mamdani, who operated on a promise to raise New York City's base pay to $30 per hour by 2030. Hotel market associations, consisting of AHLA, have denounced comparable legislation across the nation, consisting of the recently passed $30 wage ordinance in Los Angeles. "Demand has not kept up with this pace," she stated. "We're also seeing these challenges intensified by legislation that targets hotel operations, such as extreme labor and licensing policies like the New York City City Safe Hotels Act. When need is falling and expenses are soaring, the math simply does not build up." Salaries, earnings and payroll-related expenditures paid by hotels now account for more than 32% of total earnings, according to AHLA.

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As more hotel guests turn to synthetic intelligence to boost their travel experience, booking hotels directly through large language models (LLMs) may be next, hospitality specialists stated. Agentic commerce a process by which self-governing AI agents act on behalf of a consumer to find, compare and finish purchases is a trend that has accelerated across industries like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials stated they're likely to utilize AI for travel recommendations. That number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, told Hotel Dive. Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct reservation, larger multibrand hotel companies will "embed LLMs into their own brand name sites and mobile apps, and alter the way the consumer searches," Kletzel said.

"If you are not visible in an LLM search results page which lots of brand names aren't, and this is the big panic that they're all going through today customers aren't going to consider you," he said. Michael Klein, head of retail, travel and hospitality item marketing at AI customer experience platform Talkdesk, likewise told Hotel Dive that hospitality players need to ensure their home info is being indexed by LLMs to appear in tourist questions.