Millennials ready to roll; Boomers staying home
Millennials ready to roll; Boomers staying home
New Spring 2026 data from PwC suggests that Millennials plan to spend the most on upcoming travel, while Boomers plan to spend the least.
https://www.hotelinvestmenttoday.com/Forecasts/Millennials-ready-to-roll-Boomers-staying-home?
NATIONAL REPORT – New Spring 2026 research from PwC suggests Millennial parents, optimistic about their finances, active on social media, and increasingly open to AI-assisted discovery, are preparing to spend meaningfully on celebrations, gifts, and travel. For retailers, PwC said, the convergence of optimism, platform engagement, and household spending pressure is less a trend to monitor than an opportunity to act on.
When it comes to travel, about 51% of all respondents plan to stay home in March and April, driven by Boomers (66%) and Gen X (60%). Gen Z and Millennials, meanwhile, are going the other direction: just roughly 39% of Gen Z and 38% of Millennials plan to stay home. Roughly 57% of parents with children under 17 plan to travel this spring.
Parents with children under 17 plan to spend an average of $500 on spring travel—compared to $84 among non-parents and parents of adult children. Millennials plan to spend an average of $422 on travel, the highest of any generation—compared to roughly $345 for Gen X, $141 for Gen Z, and $77 for Boomers.
AI-assisted shopping has nearly doubled since PwC’s Holiday Outlook survey, rising from ~15-16% to nearly 30% among key consumer groups.
PwC added that consumers who use social media for spring holiday inspiration spend nearly 3x more than those who don’t ($1,517 vs. $583).
For Millennials, that number is even higher, with social media shoppers spending $2,190 on average compared to $761 on average for Millennials who don’t use social media to find products. But the gap holds across generations; even Boomers who use social media for product discovery spend significantly more ($492 on average vs. $325 on average).
Roughly 50% of Gen Z now use social media to discover spring holiday products or ideas, up from 43% in PwC’s most recent Holiday Outlook. On average, 44% of Millennials do the same, up from 42%.
For retailers, PwC said the implication is direct: the consumer most likely to spend this spring is also the consumer most likely to be influenced by what they encounter on their feed.
More broadly, according to PwC’s latest consumer survey, Americans plan to spend an average of $925 this spring holiday season—roughly 60% of what they spend during the winter holidays. But that topline number might understate the full story. Spending is concentrated among a specific consumer: optimistic, digitally engaged, and more likely than not, shopping for children.
Parents with children under 17 outspend non-parents by nearly 4x. Millennial parents plan to spend an average of $1,868—compared to an average of $501 for Millennials without children. Roughly 65% of all parents with children under 17 are Millennials, making this segment a large driver of spring retail spending.
The generational breakdown:
• Millennials plan to spend an average of $1,594—more than other generations.
• Gen X plans to spend an average of $944.
• Gen Z plans to spend an average of $776.
• Boomers plan to spend an average of $351.
Roughly 49% of all consumers say they are somewhat or very optimistic about their overall financial outlook heading into spring. Millennials (roughly 54%), Gen Z (roughly 51%), and Boomers (roughly 49%) are the most optimistic of the generations, displaying a level of consumer confidence even amidst ongoing uncertainty.
An average of 29% of Millennials describe themselves as “very optimistic,” the highest share of any generation surveyed.
Gen X isn’t feeling as positive: only roughly 39% describe themselves as somewhat or very optimistic.
Bulls in US are winning so far in 2026
Truist reports back some owners/operators at ALIS who said U.S. performance would be better than forecast.
https://www.hotelinvestmenttoday.com/Forecasts/Bulls-in-US-are-winning-so-far-in-2026?
NATIONAL REPORT – The headlines may not be pretty with TSA snafus, war in the Middle East, a roller coaster stock market, FIFA cancelling rooms, and general lingering uncertainty, but some of the wise guys at ALIS have been right so far – the U.S. hotel industry is outperforming early 2026 forecasts.
CoStar’s latest weekly data has continued a trend of positive results with March 15-21 showing 67.7% occupancy (+2.7% YOY); ADR at $169.02 (+2.2% YOY); and RevPAR +4.9% YOU at $114.44.
The calendar set up is helping, but Truist Securities published a note on Thursday stating they are “taking the over” on RevPAR growth.
Based upon their analysis, forward trends look encouraging with 2026 RevPAR growth for U.S. hotels continuing to look at least modestly better than industry forecasts.
Truist cited tailwinds from a very favorable holiday-timing calendar in 2026 and easier year-over-year comps in 4Q26 following a government shutdown-related pull-back in demand in 4Q25. It also sees group attrition subsiding beginning in 3Q26.
“While overall summer and fall trends look very encouraging in our ‘big data’ intelligence, we see the greatest RevPAR upside vs. industry/company/consensus expectations with limited-service hotels,” Truist wrote. “Additionally, while it should not be a surprise at this point that the World Cup-aided June will be a very strong month, we see it tracking materially above industry expectations, and secondly, we see the months of July and September as real upside surprise months.”
Truist continues to forecast mid and upper-end U.S. hotels’ RevPAR growth of +2% to 4% year-over-year (upper-end at or above this range) and limited-service at +0.5% to 2.5%. These growth rates are approximately 100-200 bps above what most industry forecasters and Wall Street consensus are currently expecting.
For 2Q26, Truist is maintaining mid and upper-end U.S. hotels RevPAR forecast of +3.5% to 5.5% and limited-service at +1.5% to 3.5%. These ranges are above consensus expectations, especially for limited-service. World Cup-driven June is tracking materially higher than industry expectations.
The FIFA World Cup will take place from June 11 through July 19 across 11 U.S. host cities, and Truist suggested a wildcard to demand (besides geo-political events) for hotels in host cities will be how much short-term rental inventory (aka Airbnb) comes out of the woodwork for these events, something it has seen occur at major events such as the Super Bowl.
Trust sees for the month of June overall U.S. RevPAR growth materially above the approximate 1.5% to 2% growth that industry forecasters are expecting, likely 2-3x this rate of growth, possibly higher.
It said strength is driven by individual leisure travelers, as the group is surprisingly lethargic around this event.
Truist added that, despite some reports in the media about weak “actualized demand,” with the exception of New York City, they see it very strong. “NYC is the one World Cup market where June occupancy is tracking down year-over-year. This, we believe, is from NYC hotels pricing room rates much too aggressively,” Truist wrote. “That said, RevPAR growth for this market for the month should still be up in the teens year-over-year and even stronger for July when it hosts the World Cup final and sees strong demand from the 250th anniversary.”
For 3Q26, Truist has introduced a forecast with mid and upper-end U.S. hotels RevPAR at +4% to 6% and limited-service of +1.5% to 3.5%, with July and September especially strong. These ranges are above consensus expectations, especially for limited-service.
The transient customer segment, which is a combination of individual business and leisure travel, is tracking to be the strongest grower in 2026, whereas the group customer, with any renovation tailwinds such as with Ryman Hospitality, will be the relatively weakest customer. “At the moment, transient customer RevPAR looks to be up low-to-mid single-digits for 2026 and reflecting the continuation of bifurcation/k-shaped trends, the upper-end will be closer to up mid-single digits (we previously said low-to-mid single) year-over-year with the more mass-market customer closer to up low-single digits (we previously said flat-ish),” Truist said.
Group attrition continues through 1H26, according to Truist, but should turn a corner in 3Q26. “For the first half of the year we observe group block revenue pace tracking up mid-single digits year-over-year but because of attrition (meaning not as many attendees showing up as initially planned when the meetings/conferences were originally booked, something that plagued the industry for most of 2025), final group revenue growth will likely be closer to up low-single digits,” Truist wrote.
“However, beginning in 3Q, attrition looks like it is subsiding, and we are starting to see more actual reservations (bookings made by the conference attendees when they reserve with their credit cards as part of the group block) being booked than what was initially expected when the meetings/conference was originally planned (the “initial group block”). For 3Q, the group block revenue pace is tracking up low-single digits, but actual credit card bookings coming in point to group revenues tracking closer to up mid-single digits, a flip from the previous trend.”
Truist send the group trend is flipping due to a combination of lapping last year’s acceleration in attrition, much of that due to DOGE cutbacks and deceleration of international in-bound (international accounts for approximately 5% of U.S. group/convention attendees and that customer was down by 50%) and meeting planners being slightly more conservative with their initial expectations for attendance following last year’s uptick in attrition.
Truist said it sees final 2026 group revenue pacing closer to up mid-single digits and roughly in line with what companies noted at 4Q25 earnings in February/March (note that company expectations for 2026 group revenues have declined with each subsequent quarterly update).
On the leisure side at full-service resorts, Truist said that based on data from resort analytics company Inntopia/DestiMetrics through February 28, which looks at forward RevPAR at hotels at western U.S. ski resorts, the summer looks very encouraging.
May through August on-the-books occupancy is up 3.9% year-over-year, ADR is up 7.9%, and revenues are up 12.1%. The +12.1 year-over-year revenue gain is higher than at any time since the post-pandemic bounce, according to Truist.
Truist Securities believes such strength is helped by hotels at western U.S. ski resorts, these typically higher-end types of properties being beneficiaries of the better side of the K-shaped economy.
Euro investors maintain capital deployment
Cushman & Wakefield survey found that Italy is the top target for investment in 2026, followed by the Iberian Peninsula and France.
https://www.hotelinvestmenttoday.com/Regions/EMEA/European-investors-deploying-capital?
INTERNATIONAL REPORT — Most European hotel investors (86%) plan to maintain or increase their investment in 2026, and 58% plan to deploy more capital this year, according to the Cushman & Wakefield “European Hotel Investor Compass 2026” report.
The report said Italy is the top target for hotel investment in 2026, followed by the Iberian Peninsula and France. The capital deployment focus for those investors is 80% for value-add deals and 58% for opportunistic. The study reported that the average fund size was nearly €200 million, slightly below the €210 million in last year’s survey. The report said 54% of investors intend to be net buyers in 2026, while only 7% expect to be net sellers, both of which are down year-over-year.
Cushman & Wakefield said investors surveyed continue to favor higher-end hotel classes and urban locations, with 81% interested in upper upscale or upscale hotels, and 69% in luxury hotels. Interest in economy hotels is more mixed but still significant. The survey found that 89% of investors are highly interested in urban hotels, with 62% interest in resorts and 46% interest in serviced apartments following behind.
Investors from the Asia Pacific expressed the highest interest in urban hotels, while investors from the Middle East and Africa expressed the strongest intention to invest in resorts.
Mediterranean countries remain in favor with investors, with Italy ranking as the most sought-after market for hotel investors in 2026 (up from 2nd last year), followed by the Iberian Peninsula and France. Key cities that drew interest include Milan, Italy; Madrid; Rome; London; and Paris, with increased interest in Budapest, Hungary; Nice-Cannes, France; Berlin; Munich, Germany; and Prague.
The top challenges for investors include rising construction costs, geopolitical, and macroeconomic risks. Relative to 2025, the study found that investors are increasingly concerned about hotel performance uncertainty (up 6% YOY). Conversely, financing issues are less of a concern for investors (down 19% vs 2025), as debt conditions continue to improve.
Cushman & Wakefield said on average, investors assume a 51% loan-to-value ratio when underwriting new deals (compared to 49% last year). While the majority of investors expect yields to remain broadly stable across European markets in 2026, 20% of respondents expect compression across the regions on average. On average, investors expect a 15.6% return on equity (ROE) for deals in 2026, an increase from last year (13.6%), potentially reflecting the increased underwriting uncertainty.
The survey also found that ESG issues increasingly affect transactions, with 71% encountering them recently. The average green premium return for highly sustainable hotels is 4.3%, with North American and European investors expecting returns of 5.2% and 4.2%, respectively.
Finally, artificial intelligence is expected to significantly influence the hotel industry by 2030, with 81% anticipating a major impact. Limited-service hotels are expected to benefit the most from AI implementation, according to 86% of surveyed investors, followed closely by full-service properties at 85%.
Geopolitics, Middle East crisis require future-proofed hotels
Hoteliers share strategies for how they're managing and avoiding additional costs
Future-proofing their European hotels is critical for (from left) Martina Maly-Gaertner, UBM Development; Valerie Schuermans, Radisson Hotel Group; Luciano Scarfone, Pygmalion Capital; and Yannick Wagner, Accor. (Terence Baker).
https://www.costar.com/article/1971788085/geopolitics-middle-east-crisis-require-future-proofed-hotels?
BERLIN — Future-proofing is the new marathon-training plan for the hotel industry amid noisy geopolitical unrest, the continuation of cost increases, the jitteriness around interest-rate levels, and the K-shaped bifurcation of customer spend.
More noise requires more care, panelists said at a panel titled “Balancing risk, demand and opportunity” at the International Hotel Investment Forum.
Martina Maly-Gaertner, chief operating officer and member of the board at UBM Development, said the rate of inflation is still outpacing growth in the average daily rate.
She said her company is investigating strategies for combatting that, but they can be "more time-efficient but not always cheaper."
“We ask, what costs can we tighten?” she said.
The current Middle East crisis has increased oil prices and, as a result, construction costs too.
Maria Calvo, director of hotel asset management at business advisory Savills, said she has seen construction costs in the United Kingdom increasing per key from £60,000 to £120,000.
Hotel brands are increasingly adding to their soft brand portfolios due to these pressures.
“Construction costs are [investors’] second concern behind geopolitical noise,” she said.
Key money from the brands helps but is not the answer to future-proofing, said Luciano Scarfone, investment director at Pygmalion Capital.
“Key money is never the final decision,” he said.
A strategy Scarfone uses is to appoint a white-label operator on the acquisition of a hotel, take the former flag off the door, and go through a new brand-selection process while doing some property improvements.
“Key money does not move the strategy. There is an agreement during the CapEx period that the hotel will be independent, with the next brand committing to this and the business plan. [For the brand that creates a] shift from being a flag on the building to being a partner in the building,” he said.
Yannick Wagner, deputy chief development officer, Europe and North Africa, premium, midscale and economy, at Accor, said that while key money can move forward the conversation, it is only ever a short-term incentive.
Valerie Schuermans, chief development officer, Western Europe at Radisson Hotel Group, pushed back a little, saying in the current climate, what is required is increased liquidity.
“Nothing is free in life, but key money can be an important lever, certainly in markets of uncertainty,” she added.
Maly-Gaertner said hotel rebrands appear more often in periods of uncertainty, and key money will never be far from the table in such periods.
“Any change of operator will have an impact on the P&L,” she said.
Designing flexibility
Hotels that are flexible and able to push revenue per square meter are in the best position to gain profitability.
Completing such a task, some on the panel said, does not necessarily require a brand over the door.
Schuermans disagreed.
“We feel our brands are relevant, focused on the destination or the segment, or both. This is essential for profitability,” she said.
Wagner said he believed the continual reanalyzing of brand standards might not always add something to the hotel or to guests’ hotel-choice criteria.
Scarfone said if an owner does not know who the next buyer will be, they must keep open all eventualities.
“An investor after five years will say I need all the options on the table,” he said.
Flexibility can also be baked in through technology, artificial intelligence, experiential components, and sustainability. Sustainability is flexibility, panelists said.
They said in Europe, sustainability is now a core element, and without it, no institutional owner will even look at a hotel there.
The same is true of many banks’ debt books. Cheaper finance, or at least finance at competitive rates, depends on a hotel’s or hotel firm’s ESG credentials.
“ESG pays back if it is done properly,” Scarfone said.
“This is more expensive to do in existing hotels, but it is still the right thing to do financially,” Schuermans said, adding the “right thing” also includes extending ESG along the supply chain.
Scarfone said the certification process is worthwhile to undergo.
“It proves you have done your homework,” he said.
Wagner said it is a mistake, too, to underestimate guests’ interest in these matters, as that interest directs where their spending goes.
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