A Marcus & Millichap video examines how inflation and energy prices might impact hotels this summer
The Bank of America Institute’s “Summer Travel 2026” outlook indicated that summer plans are continuing despite higher oil and gas prices. Thirty percent of respondents said that higher gas prices won’t change travel plans, while others might take fewer trips or cut back on accommodations.
Another fun fact is that there’s a “K” shape to summer plans, with “lower-income households much more likely to say they don’t plan to travel this summer,” the outlook said.
The above is why Marcus & Millichap Senior Vice President John Chang suggested that the impact of inflation and energy prices is more nuanced than the overall picture might appear.
In a recently released video, he said much of the impact is concentrated in the limited-service hotel segment. But that’s not news, as this category’s occupancy rate has been trending lower for several years, Chang said.
On the other hand, “the demand for select-service hotels has remained relatively stable since 2022, while full-service hotel demand has been rising,” he added.
In fact, when examining the whole picture, Chang indicated that the total number of hotel room nights sold has been relatively stable since 2023. “Looking deeper into the trend, and breaking the performance metrics by chain scale, economy hotels demonstrate the most substantial performance softening in the post-pandemic era,” he said.
Another plus is a construction slowdown, which means fewer rooms to compete with.
“Although the 2026 summer vacation season probably won’t be a blockbuster year, it should prove to be steady, with modest gains in the upper echelon full-service segments,” Chang said.
On the investment side, Chang said that property sales are up by about 19% from the 2024 cyclical trough and similar to 2016’s transaction velocity. “Pricing has remained relatively stable since 2023, at an average of $113,000 per key and a cap rate of about 8.7%,” he said. “For investors, the hospitality outlook remains cautiously positive, but steady.”
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