For the first time since 2002, fees and surcharges are likely to decrease this year in response to the global economic downturn, predicts Dr. Bjorn Hanson, clinical associate professor at New York University's Tisch Center for Hospitality, Tourism and Sports Management. In a new trend analysis report released today, Hanson forecasts that American hotels will collect $1.65 billion in fees and surcharges, down from $1.75 billion in 2008.

"The decrease in fees and surcharges collected in 2009 will reflect a decrease in the number of occupied rooms of approximately one to three percent, which is the approximate range among various lodging forecasts, and a concern about introducing new fees or increasing fees in a period of less demand and greater price sensitivity," reads Hanson's report. "Also, decreases in demand will be greater in the hotel segments most associated with fees and surcharges and some guests will change their activities to reduce these costs."

According to Hanson, fees and surcharges became standard industry practice in 1997 and increased rapidly through 2000, when they reached $1.2 billion. In 2001, following Sept. 11, fees and surcharges dropped to $1.0 billion. They dropped again in 2002, to $550 million, and rose again in 2003, 2004, 2005, 2006 and 2007, holding steady in 2008.

Among the fees and charges that Hanson says have been introduced or increased in recent years: resort or amenity fees, early departure fees, reservation cancellation fees, Internet fees, telephone call surcharges, the costs of local calls, business center fees, room service delivery surcharges, charges for in-room safes, and automatic gratuities and surcharges.

Fees have grown for groups, too, according to Hanson, who says that charges for the following services have recently increased: charges for bartenders, service and other staff at events; charges for setup and breakdown of meeting rooms; charges for meeting rooms in which meals are served; and fees for master folio billing.

"These fees and surcharges have become an important source of revenue and profits for full-service hotels and resorts because the new and increased charges reflect little or sometimes no new costs," Hanson writes. "Further, it is important to note that during the past five to six years the industry has spent record amounts on capital expenditures for enhanced guest amenities and services—including upgraded bedding, flat screen televisions, high-speed Internet access and in-room amenities such as ironing boards and irons, coffee makers and much more—and has sought ways to recover or generate returns on these investments."

Hanson based his 2009 forecast on interviews with industry executives and corporate travel executives, analysis of industry financial data, press releases and information available on hotel and brand Web sites. This page is protected by Copyright laws. Do Not Copy