Business travel trends could drive demand for serviced apartments
Tuesday, November 6, 2012
As the year draws to a close, many travelers expect airfares to increase over the holiday season. Rises in fuel costs, reduced services, potential mergers and heightened demand are all fueling an increase in the cost of air travel, in both the recreational and business markets. Corporate travel managers may soon want to add serviced apartments and corporate housing to their lists of preferred suppliers, as The New York Times reports that hotel rates could see similar rate hikes.
The news source reports that, according to several corporate travel managers, executive lodging rates in 2013 are already looking substantially higher than this year.
R. Mark Woodworth, president of PKF Hospitality Research, told the news source that he expects "well above average" rate increases for the next three to four years. Eileen Kelly, a travel liaison at Blue Cross Blue Shield of Florida, told the news outlet that she had already begun to experience higher rates when attempting to secure accommodations for business travelers within the organization.
Many experts believe that signs of economic growth and recovery have invigorated companies across the U.S. that have been hesitant to invest in overseas travel. However, as confidence returns to the market, many hotel chains seem likely to capitalize on the growing strength of the economy by increasing rates, particularly for executive clients. As a result, travel managers may soon begin choosing corporate apartments over traditional business-class hotel suites.
The rules of the game
Although businesses across many sectors are facing challenges in the business travel market, many executives see face-to-face meetings as an essential part of landing new clients, forging relationships with suppliers and investing in emerging markets.
According to Crain's Business Cleveland, many companies see business travel as a necessity. While corporate travel managers will do everything they can to minimize the cost of a trip, in some cases, there is little choice other than for organizations to absorb the additional costs.
"We think about what we need to do to be successful," Robert Rosenthal, president of Cleveland-based Finch Co., told the news source. "If it entails being in the market to meet people and find the best product, that's the cost of doing business."
While business travel costs may be rising, choosing corporate housing and serviced apartments is one way to provide executives with superior service at a cost-effective rate. As companies across the nation are pressed to make every dollar count, the popularity of these services may soon be on the rise.