The U.S. hotel industry is expected to spend $5.6 billion on capital expenditures this year, exceeding the most recent record of $5.5 billion set in 2008.
The information comes from research by Bjorn Hanson, the divisional dean of the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management at New York University.
Hanson estimates that one-fifth of hotels will receive improvements this year, up from 15 percent in a typical year.
Drew Ballensky, a market pundit and Duro-Last Roofing’s energy-efficiency and cool roof guru, reported about Hanson’s survey in his Duro-Last blog last week.
Investors and management companies that waived spending to offset lower profits in a weak economy are now looking at projections showing a much healthier outlook, Hanson says.
Occupancy this year is expected to be at its highest level since 2007, while industry profits will be a record $46 billion, Ballensky reported.
Larry Olmsted, a contributor to Forbes, wrote in February that the MGM Grand in Las Vegas just spent $160 million and 11 months to completely redo 4,200 rooms and suites. The renovation added sustainable features such as LED lights, more efficient thermostats, solar shades, upgraded faucets and showers, and 100 percent biodegradable bath amenities.
That staggering cost does not include the many other elements of the resort’s “Grand Renovation,” including the addition of a five-story nightclub, a new restaurant by celebrity chef Michael Mina, major casino upgrades, a new comedy club, and much more.
In a recent survey, 57 percent of travelers said they often make eco-friendly travel decisions. To meet this growing demand, hotels, airlines and rental car companies are working to implement strategies that take the environment into consideration, according to a report in HotelManagement.com.
Two of the world’s urban grand hotels, London’s Savoy and Paris’ Ritz, both have undertaken renovations so dramatic they require closing completely for two to three years.
Closer to home, the Ritz-Carlton Laguna Niguel on the Pacific coast in Los Angeles is marking its 30th year with all new pale blue and white guestrooms and more. The hotel’s location was the source of inspiration for the new design.