Global Luxury Hotel Market May Exceed $20b by 2022

According to a new report published by Allied Market Research titled “The Luxury Hotel Market” was valued at $15.5 billion in 2015 and is projected to reach $20.4 billion by 2022, growing at a compound annual growth rate of 4% from 2016 to 2022.

The business hotels segment accounted for around 42% of the total market revenue in 2015, Traveldailynews.com reported.

Luxury hotels provide comfortable stay to tourist and travelers along with services such as spa, swimming pool and fitness center. The market for luxury hotel has grown significantly in the past few years due to the rise in the number of business travelers globally.

Change in customer preference and upgrading services provided by hoteliers further boost the demand for luxury stays.

The global luxury hotel market is driven by the rise in travel and tourism industry, increase in preference for leisure travel and improved standard of living. However, the premium rate charged by such hotels restrains market growth.

According to Sheetanshu Upadhyay, research analyst at Allied Market Research, “The rise in the number of business travelers and change in customer lifestyles have fueled the demand for luxury stays, with an increased trend for various luxury services such as spa and others. North American and European regions dominate the market due to the higher number of tourist arrivals.”

In 2015, North America and Europe collectively accounted for around two-thirds of the total luxury hotel market size and are expected to continue to dominate the market due to the increase in the number of tourists and travelers.

Business hotels segment is expected to rule the market throughout the analysis period (until 2022), owing to the huge consumer base, which includes business travelers, tour groups and small conference groups.

Airport hotels segment accounted for around 20% share of the overall luxury hotel market revenue in 2015 and is expected to grow at a CAGR of 3.7% during the forecast period. These hotels usually target business clients, passengers with overnight travel or cancelled flights, and airline crews or staff.