Chains struggle with AI strategy, independents see fast ROI





Chains struggle with AI strategy, independents see fast ROI

https://www.hotelinvestmenttoday.com/Asset-Management/Chains-struggle-with-AI-strategy-independents-see-fast-ROI
By Marisa Garcia


INTERNATIONAL REPORT – Artificial intelligence (AI) is advancing in hospitality, making it easier for staff to offer guests the human touch while the technology takes over other operational processes. New research on both global hotel chains and independent properties reveals that AI adoption is expanding across the hospitality sector, but barriers remain, including strategy, skills and integration.

Two studies – H2c’s AI & Automation in Hospitality: Navigating Today’s Challenges, Shaping Tomorrow’s Gains and TakeUp’s AI Hospitality Revolution 2025 – off a view of how differently large hotel groups and independent operators approach AI.

Together, they capture perspectives from more 370 hoteliers worldwide, encompassing luxury chains, mid-market brands and small, independent hotels.

Chains see AI potential, strategy and trust lag

According to H2c’s global study, based on input from 171 hotel chains representing more than 11,000 properties, 78% of chains already use AI and 89% plan to expand applications in the next 12 to 24 months.

Chatbots dominate current usage (42%), while customer data management is the leading area of planned investment (50%).

Notably, hotels’ reliance on AI lags behind their stated trust in the technology. While hoteliers gave AI a trust score of 6.6 out of 10, actual reliance on AI averaged only 4.7—that reflects the lack of a formal strategy for AI adoption.

Only 7% of hotel chains report having a comprehensive, company-wide AI strategy. The barriers to AI adoption for hotel chains are substantial: 

  • 62% cite a lack of expertise
  • 51% say strategy is unclear
  • 45% struggle with integration
  • 39% cite high costs or budget constraints

Other hurdles to overcome include organizational resistance to change (31%), concerns over data security and privacy (30%), uncertainty on ROI and investment (27%) and data quality and accessibility issues (26%).

“AI adoption in hospitality is accelerating, but most hotel chains are still experimenting,” said Michaela Papenhoff, managing director of h2c. “Bridging the trust-reliance gap will require more investment in staff skills, better integration, clear ROI measurement and a focus on use cases that deliver tangible value.”

Independents move faster on AI and see benefits

If big brands are cautious, smaller operators are showing striking agility in AI adoption.

TakeUp’s poll of 200 independent property owners and managers found that 74.5% of properties using AI report positive results, while most (66%) have been using AI between six months and two years, they already report measurable returns.

  • 16.7% report that automated guest communication has delivered the most value
  • 13.8% have benefited most from AI in marketing campaign optimization
  • 12.1% report gains from using AI in dynamic pricing optimization
  • Many (19.7%) cited time savings and efficiency as their top reasons for AI adoption, with cost reduction (13.1%) and competitor advantage (10.12%) also being key motivators.
  • Guest communication is the top adoption area (13.4%), followed by marketing and advertising (12.1%) and social media management (11.2%).

The revenue impacts of AI adoption are also notable. Among properties reporting gains, 25.5% saw revenue rise between 6 and 10%, while another 35% reported increases of between 11 and 20%.

“Independent property owners aren’t just dipping their toes into AI anymore, they’re diving in and using it to win,” said Bobby Marhamat, CEO of TakeUp. “The fact that 74% of owners say AI has met or exceeded expectations shuts down the outdated myth that small properties can’t succeed with AI.”

Nearly 70% of those surveyed view AI as essential to staying competitive, and 39% call it a significant competitive advantage.

Common threads

Despite differences in scale, both studies highlight the same motivations: reducing repetitive tasks, boosting efficiency and enhancing guest experiences.

For chains, business intelligence (78%), chatbots (77%) and digital marketing (72%) rank as the most valuable applications.

For independents, automated guest communications (16.7%), marketing campaign optimization (13.8%), dynamic pricing optimization (12.1%) and energy cost reduction (12.1%) are the top priorities.

In both cases, staff acceptance of AI is positive. TakeUp’s survey found 78% of staff are somewhat comfortable or very comfortable with AI tools. Meanwhile, two-thirds of h2c’s respondents said AI frees teams to focus on more strategic or guest-facing work.

“I believe people have very special skills—but they often don’t have the time or space to use them. With AI, we’re finally giving that time back,” a small chain executive cited in the H2c study said.

For both groups, the balance between automation and personal touches is still an essential element of hospitality. Half of chains (62% of large chains) and 74% of independents say maintaining a personal touch is critical.

“In hospitality, the human touch makes all the difference. Even if tasks change, humans will continue to add the most value,” said a chain executive in the H2c study.

Even so, traveler trends will drive the expansion of AI adoption. More than 60% of independents responding to the TakeUp study reported that guests appreciate or love AI-powered features.

AI from the hotel guest perspective

Travelers are increasingly at ease with AI. Phocuswright research found in its “Chat, Plan. Book: GenAI Goes Mainstream” study that more than half of U.S. travelers (51%) now use generative AI (not just for travel), up from 39% in 2024 and 22% in 2023.

Adoption in other markets is also growing. In the U.K., 41% of travelers surveyed said they used generative AI, up from 36% in 2024 and 14% in 2023. Travelers in France (39%) and Germany (38%) are also increasingly more comfortable with AI in day-to-day applications.

  • 33% of U.S. travelers use generative AI tools (ChatGPT, Google Gemini and AI-powered search) to plan their trips and, while traveling, for in-destination support
  • 22% of UK travelers rely on AI for their trips
  • 22% of French travelers use AI for travel applications
  • 15% of German travelers use AI tools for trips
  • Among travelers who actively use GenAI, between 38% and 55% used it to plan at least one trip.

Perhaps unsurprisingly, younger generations are more likely to use GenAI to plan their travels. Around 60% of millennials and younger travelers in the U.S., U.K. and France use the technology—the share drops to 44% in Germany. By comparison, GenX and Baby Boomers generally lag behind in AI trip planning, with a median of 33% among all regions combined.

When it comes to finding their next hotel, 85% of U.S. travelers trust AI to search.

And trust in AI is growing; between a quarter and a third of travelers surveyed across the four markets said they would be interested in booking their travel through a GenAI engine, or letting an AI assistant book for them if the service were available.

AI-answer engine offering hotel bookings

There are many applications for AI in the travel industry, and technology companies also see growth opportunities in the space. As PhocusWire reported in May, AI-powered answer engine Perplexity partnered with Selfbook and Tripadvisor to let AI users book hotels.

“We are introducing answer modes in Perplexity to make the core search product even better for verticals: travel, shopping, places, images, videos, jobs,” Aravind Srinivas, co-founder and CEO of Perplexity, said in a post on LinkedIn.

“The next step is to get super precise [so] that you don't have to press on these tabs.”

Perplexity is already pondering how to incentivize booking adoption, Srinivas said. “We plan to bring some benefits to our Pro users like discounts on hotel bookings done natively on Perplexity. More on this soon.”

Moving from AI experimentation to integration

For large hotel chains, the next challenge is moving beyond pilots to enterprise integration, with rising interest in robotic process automation, proactive AI agents and digital identity verification. For independents, expansion plans center on intelligent energy management, more guest communication automation and advanced marketing tools.

Both studies suggest early AI adopters in the hospitality space can capture a competitive advantage. For global hotel groups as much as for family-run inns, the key will be developing an AI strategy that works business before competitors do.


Developer behind Sapphire Bay given default notice from North Texas city

Team 'remains committed' to project despite delays


The city of Rowlett wants to see a project that is expected to include a luxury hotel and lakeside lagoon take shape. (Sapphire Bay)
https://www.costar.com/article/1018131808/developer-behind-sapphire-bay-given-default-notice-from-north-texas-city
By Candace Carlisle


A North Texas city has given a default notice to a developer that had promised a $1 billion hotel and resort anchored by a lakeside lagoon, saying the project has remained "stagnant for far too long."

However, the development group, known as Sapphire Bay Land Holdings I, told CoStar News it is fully committed to developing the mixed-use project — called Sapphire Bay — despite allegations to the contrary.

The development group "remains committed to developing all agreed upon development components, both residential and commercial, within the Sapphire Bay project that are contained within the terms of the master development agreements" between the developer and the city of Rowlett, Marc English, president of the development group, said in an email to CoStar News.

He added that project delays "are to be expected" because of changes in the development plans.

In the coming months, English said the site will become home to a Jimmy Buffett Margaritaville Hotel, a Landshark Restaurant and a Hilton Tempo hotel. A Bombshells Restaurant and Sports Bar is expected to open in January, he said, adding that the mayor and city council have been briefed on the project's "largest new attraction," which has yet to be publicly announced because of nondisclosure agreements tied to ongoing deal negotiations.


The Rowlett city council voted unanimously, after deliberations and receiving legal counsel, to provide notice to the developer, Sapphire Bay Land Holdings I, the city said this week. Rowlett is a municipality about 20 miles northeast of downtown Dallas.

About four years ago, the group unveiled plans for the convention hotel and resort with more than 500 rooms, suites and villas to have a Hyatt flag. However, those plans have yet to take shape.

"This project has remained stagnant for far too long, and we owe it to our residents to take action that will help spur progress on the peninsula," Mayor Jeff Winget said in a statement, referencing a land mass jutting out into Lake Ray Hubbard.


Which California Wine Region Is the Very Best?




Eric Luse/Sonoma County Tourism
https://www.fodors.com/world/north-america/usa/california/experiences/news/which-california-wine-region-is-best-to-visit
Carrie Bell 



Will Napa, Sonoma, Paso Robles, or Santa Barbara meet your grape expectations?



When it comes to wine, California is kind of a big deal.

The state boasts 6,200 wineries fermenting, blending, and bottling 229 million cases of wine. One hundred varietals are grown across 610,000 acres within 154 recognized AVAs (American Viticultural Areas). A massive 80% of the country’s annual supply comes from Cali, making it the world’s fourth-largest winemaking region. It’s also big on quality, especially the full-bodied crimson beauties conjured from the state’s most widely grown grape, Cabernet Sauvignon.

California wine also happens to be even better when tasted at the source. There’s something special about being surrounded by rolling hills of vineyards, overlooking the Pacific, or hanging out with a winemaker in a cave, a rehabbed barn, or an olive tree-dotted courtyard – ideally with a plate of local charcuterie or a Michelin-starred feast. It’s more fun when you go between winery appointments by bike (Sonoma Valley Bike Tours), horse (Vino Vaqueros), electric tuk-tuk (Laces + Limos) or even motorcycle sidecar (Third Wheel Tours). (In fact, here are 20 California wineries that are a guaranteed good time.)

It’s easy to understand why every year, more than 20 million thirsty travelers take the Petit Verdot pilgrimage to one of California’s wine countries, and millions more have it on their bucket list. But when dealing with numbers like these, trying to decide which drinking destination to visit – even when narrowed down to the four most prominent regions: Napa Valley, Sonoma County, Santa Barbara County, and Paso Robles – can become overwhelming.

It’s why people are constantly asking Evan Hufford, co-owner of Sonoma County wine bar Maison Healdsburg, where they should go first. Thankfully, he’s developed a two-question system to answer it.

“Well, first I’d be remiss if I didn’t lead with Sonoma because that’s where we own a wine bar and it’s an enormous grab bag of wildly different wines,” Hufford jokes before adding, “In all honesty, there’s good wine all over California, but different regions offer different wines and vibes and the decision is one of personal preference. So I ask, ‘What kind of wine do you usually like to drink,’ and ‘What kind of experience do you want to have?’”

We stole Hufford’s swirling questions to create this guide, designed to help deduce which of California’s fantastic four is the wine country for you.
Napa Valley: Best for Red Wine Lovers

Best Pours: Big Bold Cabernet Sauvignons, Chardonnay
Number of Wineries: 400+


Napa Valley Wine Train



Even for the most novice wine drinkers, Napa’s revered reputation precedes itself. Sandwiched between two mountain ranges with a dry Mediterranean-style climate, 33 soil types, and 17 sub-appellations, Napa’s viticultural story begins with making sacramental wines for missions. 

It gained commercial steam in the late 1800s when wineries like Charles Krug, Beringer, and Inglenook were established – all of which still operate today. However, its global esteem was cemented with the 1976 Judgement of Paris blind tasting when Stag’s Leap Wine Cellars and Chateau Montelena outranked French Cabernet Sauvignon and Chardonnay.

The valley gets more prestigious and posher by the day, which, of course, comes with a steeper price tag. Napa is where you go if money is no object, you’re celebrating something special, or you want to stoke FOMO on your socials with stays in vineyard-hugging luxury resorts like Four Seasons Napa Valley, multi-course meals at Michelin-starred restaurants including French Laundry or Kenzo, steamy milk baths in Meadowood’s hand-hammered copper tubs, and tastings at grand old estates or newer wineries like Bella Union and CADE Estate. 

Entry-level tastings regularly cost more than $100 per person and climb as you add food pairings, activities, estate tours, or fancy transportation. For example, Shafer’s $500 Hillside Select Experience, which includes caviar, a Polaris Ranger tour of the grounds, and a seated vertical tasting. Theorem teamed up with Baccarat for a $750 tasting that pairs a winery tour, high-elevation estate vintages, a winemaker- and chef-curated menu using ingredients from Theorem’s Diamond Mountain gardens and Montana ranch, and an engraved crystal glass souvenir. 

If you have $30,000 to spare, indulge in Bardessono Hotel & Spa’s package, which includes four nights in a villa, in-suite wine and food pairing, a class on how to taste like a master sommelier, and two winery tastings.
Paso Robles: Best for Western Vibes and Creative Winemakers

Best Pours: Old Vine Zinfandel, Cabernet Sauvignon, Gsm Blends
Number of Wineries: 200+




Equidistant from Los Angeles and the Bay Area, Paso Robles, arguably the fastest growing wine region in the state, has been called wine’s “melting pot.” Like Napa, there’s a lot of excellent Cabernet here—DAOU, Austin Hope, or Booker to name a few—but unlike Napa, it isn’t Paso’s whole personality. More than 60 varietals are grown on more than 40,000 acres that fall under one eponymous American Viticultural Area, which is further divided into 11 sub-AVAs due to sundry temperatures, terrains, and terroirs.

Plenty of wineries along the dusty, windy country roads cling to old-world ways to make impressive wines influenced by France’s three most famed regions—Rhone, Bordeaux and Burgundy—as well as Spanish and German hits like Gewürztraminer and Albariño. But numerous others, including Paix Sur Terre, Herman Story, and Tablas Creek (they’ve got a llama on staff!) are geeked to experiment with kooky labels, unconventional techniques, and rarer varietals like Counoise, Négrette, Cinsault, Ugni Blanc, Roussanne, Picpoul and Vaccarese, creating unique blends that shine in the glass. 

Thacher’s Funky Fridays offer deep dives into the unconventional. Taste at huge sweeping properties topping undulating hills (JUSTIN), a repurposed industrial village of tiny-batch hustlers like Hubba called Tin City, or stand-alone tasting rooms around downtown. Regardless of which of sipping scenario you’re drawn to, the barrier to entry is fairly nonexistent – walk-ins are welcome, tastings average $40, and fees are usually waived when you buy bottles.

That inviting, never-snooty spirit spills over into the community-driven small town with a central square at its heart. It’s a mix of modern (i.e., light art installation Sensorio) and nostalgic (annual Mid-State Fair, Alta Colina’s collection of ‘50s and ‘60s trailers for rent). Jeans and boots are welcome at even the fanciest restaurants like Les Petites Canailles or Six Test Kitchen. 

There’s a strong reverence for Paso’s agricultural and ranching past and present. Nods to it can be found everywhere, from old barns converted into tasting rooms and cowboy bars like Cattlemen’s Lounge, to FARMstead ED, a family-friendly trail of hands-on experiences, u-pick farms, and farmers’ markets. Several popular lodging and dining options (Stables Inn, Cowgirl Café, Farmhouse, and Grace and Rose) favor updated western or ranch house décor, and you can even ride horses at Ancient Peaks Winery.
Santa Barbara: Best for Sipping Small Oceanside

Best Pours: Chardonnay and Pinot Noir
Number of Wineries: 300+





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