Hotels Expected To Reach Close To $3 Billion In Extra Fees
By Sharelle Burt
Remember back when you were a kid, and you couldn’t wait to travel somewhere with your family? Not just because you were going somewhere new and exciting but because for some reason, kids are fascinated by hotels.
Well, those days are over. As adults, hotels are nothing more than an expensive place to lay your head. The hotel fees alone make you want to stay home. It doesn’t look like travelers will be catching a break either as, according to a study, hotels will be making a record $2.93 billion this year in extra charges due to all of the things travelers want for free.
That number comes from New York University professor and hospitality expert Bjorn Hanson, who predicts an 8.5 percent increase from 2017. Tracking hotel fees for years, he says those charges will continue to go up in 2019 in order to help hotel operators keep up with a higher payroll and real estate costs. “Fees and surcharges are highly profitable,” Hanson said in an annual assessment of hotel industry fees. “As much as 90 percent of many charges go straight to the bottom line.”
The extra fees haven’t slowed the travel industry down because let’s be honest, everyone will need a hotel sooner or later. Hanson said the hospitality industry discovered the magic of fees in 1997 when hotels needed to compensate for higher energy costs. For the airline industry, fees really started to come about during the recession in 2008 but charges for things like checking luggage or changing reservations have helped airlines overcome rising jet fuel and payroll costs.
One of the newest trending fees for hotels is a fee for early check-in, which is most common in resort areas such as Las Vegas, however that doesn’t seem to be a sore spot for customers, according to Hanson. Resort fees range from $20 to $40 and have become more common in urban hotels that aren’t generally considered resorts. In the past, resorts have often had fees associated with gyms or pools, but now resort fees are more often charged to pay for free bottled water, breakfast and newspapers.
The fees also come from new and high charges, about 6 percent, and close to 2.5 percent of the increase is because hotels are fuller this year. With higher occupancy rates comes more people paying fees.