The past year certainly had its highs and lows, with inflation worries, lowered interest rates and continued labor issues. Hotel Business caught up with Dawn Gallagher, president, hospitality, Crescent Hotels & Resorts; Jennifer Porter, president, Commonwealth Hotels; and Chris Russell, CEO, Spire Hospitality, to get their takes on whether 2024 met their expectations, the big issues and what they see for 2025.
—Gregg Wallis
What is your take on 2024? Did it meet your expectations? How so?
Gallagher: In early 2024, Crescent Hotels & Resorts set its sights on anticipated interest rates and actively pursued opportunities in the real-estate transaction sector. While we’ve seen an increase in transactions, we recognize that we’re not quite at the level we had hoped for this year.
On a positive note, we started the year strong in our group pace and have witnessed consistent growth in business travel each quarter, even though we haven’t yet returned to the figures of 2019.
Dawn Gallagher , Crescent Hotels & Resorts
This summer, we did notice a shift in leisure-travel patterns, with more individuals exploring international destinations rather than the traditional areas in the U.S. and Canada. This presents us with a chance to adapt our offerings and refine our strategies to better meet the evolving preferences of travelers. Overall, we see potential for continued growth and a bright outlook as we move forward.
Porter: 2024 was an underwhelming year. Reduced leisure travel and softer-than-anticipated business travel muted revenue growth. Our focus across our portfolio has been to group up to try and mitigate the lack of transient business. We continue to work to fend off pressures on margins due to rising costs.
Russell: This past year was a mixed bag, but it still largely met our business expectations. On the positive side, large conferences and meetings are returning, and most have longer booking windows, which, unlike the last few years, allows us to be more strategic in our planning. Food and beverage—largely because of increased meetings and catering business—has improved, and we continue to see some modest gains in ADR.
What are the biggest issues you are facing right now?
Gallagher: In 2025, the U.S. and Canadian markets are expected to see minimal growth. With limited growth in RevPAR and continued pressure on margins, we have to look at our business model differently to ensure we retain our margins and grow our GOP. Both Crescent, and the industry as a whole, continue to be challenged with open positions. However, our strong company culture allows us to attract and retain more talent than our competitors.
Porter: Commonwealth Hotels has faced pressure on costs—labor, supplies capital investments to complete renovations and others—with limited growth in revenues.
Jennifer Porter, Commonwealth Hotels
Russell: Uncertainty from the recent election season showed some declines in Q4 and the Q1 2025 booking window. We hope that with the election now behind us, there will be less hesitation to travel and plan meetings, which will give us better visibility into the coming year. The cost of labor and other expenses continue to put pressure on margins, and the recent reductions in interest rates have not yet helped cash flow despite some stabilization in inflation.
What are you expecting from 2025?
Gallagher: Crescent Hotels & Resorts has a strong pipeline of upcoming projects going into 2025 and anticipates significant growth through hotel transactions in the coming year.
Porter: We’re happy 2024 is coming to an end, and hope for 2025 seems to be the sentiment among many. However, we continue to watch industry predictions, which seem to point to similar results as 2024.
Russell: The labor market, although improved from the last two years, remains competitive, and our hotels have to make sure that we continue to be resourceful in recruiting and not take our foot off the gas in making sure that our wages are market appropriate, and that appreciation and recognition of our team members continue to be positive and consistent. Business will be competitive throughout 2025, and we need to continue to make strides in creating unique and personalized experiences for our guests.
