Nix: What are the drivers right now in the meetings and business travel industry?
Dominguez: In the meetings and events world, we have a lot of hotel supply but much of it is limited service. That limited-service hotel space isn't going to help relax the meeting space compression that we've seen. But we're starting to see that across the board everybody is now tracking for record group numbers.
There's an underlying piece that we're missing when we look at the recovery of our industry and what that looks like. We tend to forget the new small and medium businesses that drove our economy that have been born over the last three years. The business travel commentary had always been OK. Large international multinational companies have all pulled back on business travel, but small to medium businesses were up double digits.
Nix: Are there any areas of softness?
Dominguez: Last summer, we saw softness in domestic leisure demand. That softness was specifically in the resort areas. One of the things we did see is what we are now terming revenge international travel this past summer. We had two million more Americans going out of the country than we had back in 2019. Surprisingly, I thought more of it would have been Europe, but it was the Caribbean. The Caribbean was up almost 18% compared to 2019 numbers, so what makes sense now is that it (Caribbean) is softening. We saw a little bit of softening in Florida and a little softening in the resort community. The resorts very much feel like the Caribbean. It's the same audience, but I mentioned that because we think it's temporary.
Nix: Let’s talk a little more about international travel. I went to Europe last year for the first time since 2019, and it was crowded. What are you seeing for 2024?
Dominguez: It seems like you know somebody, or you personally went to Europe or somewhere international this past year. I did too. And it's because we hadn't had that ability for a couple of years. So, I think all of that's going to normalize, and that's what I'm most encouraged about in 2024. We're going to hit some normalcy as far as cycles and patterns, which helps us be able to forecast a little bit better and more effectively run our businesses.
Nix: In the U.S., what’s the outlook for 2024?
Dominguez: Business travel that is now normalizing with group travel is really starting to move. The latest STR data shows increases on Tuesdays, Wednesdays and Thursdays. You don't increase mid-week without it being group and business travel, so that's very encouraging. For us all those markers are moving in the right direction. American Express just released their global business travel forecast for 2024, and they're showing double digit rate increases in most of the major metro areas. That's being led by the Chicagos and the Bostons of the world. Boston's been on fire when you look at it from a rate perspective and an occupancy perspective.
Nix: What about second-tier U.S. cities?
Dominguez: As the metro areas tighten up, our second-tier cities will get even busier than they are today. There are challenges, but from a forecast on the demand side, I think it is fantastic. It's probably not a surprise that you've seen St. Louis, Louisville and Oklahoma City really start to explode. The Raleigh area is on fire right now. To me, Raleigh is Nashville 12-15 years ago. They've really worked on the downtown experience.
I'm also looking at some emerging ones. Knoxville has come up as one of these destinations having a little bit of vision as far as what they want to do in an entire experience within the city that makes it a little bit fun. I spoke at a Grand Rapids program for their convention bureau. The destination was just on fire, but it’s this really small community that you really don't know much about – and I didn't know much about. And I learned this is a place I would come back to.
Nix: I recently wrote a story about the impact Taylor Swift’s Eras Tour had on hotels and will continue to have as she takes her shows global in 2024. What are you predicting about travel to live events like sports and concerts?
Dominguez: You're going to continue to see record numbers. We see it in live events. We see it in professional events. We see it in live music everywhere you turn. It is record attendance and I go back to a point I have made in the past. I think part of that desire to go to events and to travel is kind of embedded in us forever now because of the pandemic. We want the experience because it was taken away from us. There's that little bit of an innate fear as human beings that I don't know when it could be taken away again. So, I need to be able to enjoy it and take advantage of it as much as possible!
In March: How the global economy is affecting hotel supply and demand.