The Modern Hotelier #246: 2026 Hospitality Industry Outlook, 5 Trends to Watch, Hotel Bathroom Backlash, & Mews Funding | January Hot Topics
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Steve Carran: Today we have a very special guest joining us. We have The Modern Hotelier producer, Jon Bumhoffer. Jon, thanks for joining us today. How you doing? 
Jon Bumhoffer: Of course I'm doing great. 
Steve Carran: Good, good. Happy to have you join us. We're gonna kick things off right away. So it being January, there are a lot of trends and industry forecasts coming out. So we're gonna kick things off about the 2026 industry forecast. There were a few things listed here, listed as far as room outlook, group business, food and beverage industry shifts in 2026. Jon, what really jumped out to you?
Jon Bumhoffer: One was the highlight of group business. You know, it says group demand's gonna continue to rebound gradually. We're still sitting below the pre pandemic levels, but it's stable. It's continuing to rise. But the booking behavior we're seeing is shorter lead times, smaller event sizes, stuff like that. And in our previous episode that we just released this week, we had on Kunal Shah from ZS, and he was talking about how important it is, especially for sales in hotels, hotel to hotel, reduce leakage. Meaning when you get RFPs due to those shorter lead times, you gotta be responding quickly and stuff like that. So I think that's just a good note here on the group business. It's continuing to grow, but you gotta be on top of it. 
David Millili: I'll just chime in with the food portion. I think, you know, they're talking about popups health and just incorporating technology, which I think we all see, you know, as we travel, that there is this. You know, renewed kind of excitement about finding something that's only gonna be there for a limited time, or something for some of us who are, you know, maybe especially traveling, looking for something that's healthy and making sure that we're not kind of overdoing it, we're on the road. And then I think every once in a while we're starting to see more and more of just kind of technology, you know, the basic stuff like QR codes, but you know, being able to order things from your phone and then, you know, pick it up at the window, what have you. So those are some interesting things. 
Steve Carran: Yeah. And this article is by HFTP Hotel Online, and they actually gave five recommendations for hotel owners and operators that I wanted to share quickly. Budget conservatively for flat occupancy and minimal RevPAR growth. Leverage food and beverage and small group segments for incremental revenue. Reassess sales incentives towards margins, focus on metrics, not just volume. Invest in property level analytics, CRMs, and sustainability initiatives. And prepare for slower economic growth by focusing on profitability, not expansion. 
David Millili: All right, and hotel dive had five trends to watch in 2026. First one is a big surprise hotel labor costs continue to rise. Then he talked about genic commerce begins to reshape hotel bookings. New leaf launch collection brands are growing legs, luxury dominates amid a wealth purification. I think I got that right? Big events bolster hotel performance. So Steve, what one of those did you really kind of latch onto? 
Steve Carran: The one that really stuck out to me was kind of the focusing on the events, especially for those hotels that are in the segments for the World Cup coming this year, that's gonna do a lot for the economy in those cities. But I also think kind of being creative with different things to create revenue, whether that is holding events for the public, for the community in your hotel, kind of focusing on those ways to bring in additional revenue. Jon, what about you? 
Jon Bumhoffer: I mean we're talking about it all the time, labor shortages. And you know, the first topic on this article is hotel labor costs continue to rise. And those things kind of go hand in hand. You know, there's unions pushing higher wages and, and we all agree that frontline staff and hotel staff deserve to earn a living and get health benefits and all this stuff, but that is contributing to some of the labor costs.
I mean with labor costs, it's not just labor, it's insurance costs, it's property taxes, it's operations on that side. So hotel costs in general continue to rise, and that just goes hand in hand with the labor shortage where maybe people aren't presenting enough of a wage to get staff in the door or to retain staff, and these kind of things go hand in hand, not so. I mean, this article doesn't really present a solution and we don't have a solution in the foreseeable future, but the reality is they're linked together in a way that is something we have to contend with and figure out. So, David, we've had a lot of conversation about lifestyle brands and independence over the, especially last year, a lot of acquisitions, and this article hits on one of those areas. I'm curious what your thoughts are on that. 
David Millili: Still think that the two things that stood out, uh, from this list was exactly that. That how now the brands are kind of allowing, they're acquiring independence, but then they're allowing them to kind of stay their own identity with only those, those hotels really leveraging distribution, technology, loyalty as advantages 'cause now a Marriott or Hilton lifestyle type property, you don't really feel, you don't feel that it's a Marriott or a Hilton. You maybe just see like the Hilton Honors or Bonvoy sign and that's about it. So I think that's a trend. We're just unfortunately maybe gonna continue to see. And then, you know, when you look about the way that bookings are made and AI, how that's affecting it.
I think we're gonna see a lot of, the more things change, the more they stay the same. What I mean by that is that when 800 numbers came out, travel agencies got them, then hotels got their own 800 number. Then the internet came out and there was these big sites and the hotels struggled to get their own identity.
And now with AI, it seems like AI's gonna, the big brands are maybe gonna dominate that space too. So, hopefully not. And hopefully there's some hope there and it can help independents, you know, kind of fight that battle for more direct bookings, but time will tell. 
Steve Carran: And I wanna just touch base on booking through AI. This is something I'm super excited about. I know I've talked a few times about I want to just be able to book my trip and I wanna book my flight, and when my flight's booked, I wanna be able to check in with my, my hotel once I land. So I'm super excited about this, just being able to book a whole trip, flights, hotel activities, all in one space.
Jon Bumhoffer: Well, yeah, I'm gonna throw my 2 cents in here too. And the article mentioned kind of how with LLMs in booking via an agent, the hotels and brands and properties need to have, you know, content rich websites and stuff like that, that they're continuing to feed these things to kind of compete. Like David said, you know, the hope is maybe it drives more direct for independence and stuff like that, but you kind of have to have your content side figured out to do that. But again, the OTA is big players, deeper pockets, so we'll kind of have to wait to see how that shakes out. 
Steve Carran: Yeah. Jon, I agree with you. And if they don't guess what? They're just gonna give be giving more money to the OTAs because we know the OTAs have optimized websites that LLMs are gonna pull from. 
Jon Bumhoffer: So yeah, they figured it out for Web two.
Steve Carran: Yep. 
Jon Bumhoffer: You know, they're probably ahead on Web3 as well. All right, so we just got news recently that Muse secured $300 million in funding, David. 
David Millili: Yeah, it's one of the few new, you know, for lack of a better term, unicorns in the hospitality tech space. I think that would bring them, I should have done the research. I think that brings them north to 600 million total revenue that they've built as the industry has embraced cloud-based. PMSs, which is the really the heart or brain of the hotel. So I think this is really interesting. I think when you look at some of the investors that are involved, it was, you know, syndicated.
So there was four or five. Not all of them are super, super strong in hospitality, but I think this is probably, for lack of a better term, a wake up call also for maybe for some of the incumbents that are, you know, trying to move their legacy based systems to the cloud. Where Muse has started off. So it'll be interesting to see where it goes. Steve, you've very familiar with this space. What are your thoughts on that size of a check being cut to Mews? 
Steve Carran: I mean, that's awesome. That's incredible, right? So the investment values Mews at $2.5 billion, and the Mews Platform transaction volume reached 19.7 billion dollars last year. So those numbers are crazy. I feel like Muse has just been kind of running away in the PMS space. We haven't seen many companies get, get this big, especially, you know, in the, in the PMS space, they have 42.3 million checked in reservations and 3.2 million of those. Just came from the kiosk. So Mews is running, they're a steam engine with a full head of steam and I don't see 'em slowing down anytime soon, but it's so awesome to see them. Congrats to them. Their leadership team, awesome company, awesome leadership, and they have just not only built a great product, but great culture as well. So, all right guys. We have some people in the hotel space, customers and people who are staying at hotels, specifically in New York City that are really upset about this latest trend.
And this latest trend is hotel rooms leaving the bathroom door off. So now we just have no door to get to the bathroom. Jon, have you ever stayed in one of these hotel rooms with no bathroom door? And what are your thoughts, especially with two little kids at home? 
Jon Bumhoffer: I don't think, there's not a time I can recall staying in a hotel with no door. You know, the whole thing that people were up in arms about before, this is a common gripe is no door on the shower. Yes. So now it's making its way, not only we're not having a door in the shower now, we're not gonna have a door on the bathroom. And so I think with kids, you know, definitely that causes concern.
I do understand, I think a lot of places you, you said, or the article says mostly in like New York and stuff like that, so maybe it's because of space considerations, but I still think you could do a sliding door or something of that nature. I just don't see. Why we've we that this has been a trend that people, that hotels have been moving to. It doesn't seem to make any logical sense to me and only causes issues. So I don't know. David, what are your thoughts on that? 
David Millili: Yeah, when I moved out west here to Phoenix, they don't even, a lot of the designs as you don't have a door to your bathroom where the sink and shower is, and then you have a door to where the, the toilet is. And I even hate, I even hate that. I don't, so gimme a door, you know, it's like, gimme liberty or give, I think gimme a door because I think that is kind of your time. So I think the assumption that people are gonna be okay with this is the wrong assumption. I can see why it's getting backlash. Because if you're traveling with your spouse. No matter what kids, I'd rather you have the door, no door. If I was just traveling with kids than with your spouse. So I think you gotta gimme a door or I don't wanna be at that hotel. 
Steve Carran: Give me door or give me death. That's right. We were talking about trends in 2026. I'm throwing this one out here. A whole doorless hotel. No doors in any of the hotel. That's never gonna happen, but well.
Jon Bumhoffer: I just kind of going back, I can understand a little bit. You mentioned there's a lot of Desi hotel designs that have no door. We have the sink and the vanity, but then there's a door to the, the shower in the toilet. Right. And that makes sense. You know, maybe somebody's taking a shower, and somebody's doing their makeup, whatever. But the complete doorless thing is, I don't know, I got no words for it. 
David Millili: That does it for another episode of The Modern Hotelier Hospitality Hot Topics. We look forward to a great 2026. Hope to see you at an upcoming event and we'll be with you again shortly. Thank you. 
Steve Carran: Thank you.