October 26, 2018

Emergence of ‘urban hotel fees’ propels increase in surcharges


Fees and surcharges at U.S. hotels are expected to increase 8.5% to a record $2.93 billion this year.

The forecast follows a record $2.7 billion in fees and surcharges in 2017. This year's projected climb is driven by a 2.5% increase in occupied hotel rooms, plus additional fee and surcharge categories.

Bjorn Hanson, industry consultant and adjunct professor at the New York University School of Professional Studies Jonathan M. Tisch Center for Hospitality and Tourism, detailed the emergence of urban hotel fees in his recent report about 2019 corporate rate negotiations. These fees, he said, are similar to resort fees and are now common in major cities, averaging between $20 and $40 per day.

Urban resort fees - which can can cover goods and services like Internet, bottled water and newspapers - account for the largest share of this year's fee and surcharge increase, despite the industry's adoption of harsher cancellation penalties.

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