Global lodging industry: Bernstein sees a durable global lodging upcycle despite a slower 2026

Overview

Bernstein updates its global lodging model using 2025 and 2026 year-to-date data. It argues that economic growth and constrained hotel supply should sustain long-term room-night, pricing and share-growth opportunities across hotels, online travel agencies and vacation rentals, despite a somewhat slower 2026 and regional disruption in the Middle East.

Core views

Bernstein’s central framework is that economic growth is the primary long-run driver of lodging demand: higher consumer discretionary income and greater business travel both lift room nights. Consumer confidence can cause short-run deviations from the GDP relationship, particularly during recessions, but the report expects demand to revert toward its pre-pandemic trend. Global lodging demand is forecast to grow 3.6% in 2026, below the long-run rate of roughly 4%, as the Middle East conflict weighs on that region. North American and Asian GDP estimates are broadly unchanged year to date, European estimates have fallen by 10–50 basis points, and APAC and Latin America are expected to lead room-night growth at roughly 4–5% annually, versus about 2–3% in North America and Europe. The report argues that the supply side is the key source of pricing support. Hotel supply has lagged demand since the mid-2010s and remains constrained by higher interest rates, construction costs, supply-chain disruption and capital flowing to higher-return projects such as data centers. Inflation forecasts have risen globally as higher oil prices feed through from Middle East conflict; Bernstein expects this, combined with demand exceeding supply, to support ADR and real pricing, producing low- to mid-single-digit RevPAR growth across major regions. The 2026 year-to-date evidence is consistent with this mechanism: demand exceeded supply in Europe, the US and APAC excluding China, supporting stronger RevPAR, while China’s mid-single-digit supply growth amid weaker demand limited consistent RevPAR growth. APAC lodging room nights were up 8.1% year to date, while MEA room nights were down 2.8% year on year. Vacation rentals are positioned as the most elastic form of lodging supply. Bernstein expects their penetration to rise in every region as lodging demand outpaces hotel-supply growth, with global vacation-rental room nights growing at roughly 8% through the end of the decade and high-single-digit growth persisting through 2027–28. The report notes that vacation rentals lost share in 2022–23 as other lodging formats recovered after the pandemic, but regained share in 2024–25. Growth is expected to be especially strong in Latin America and APAC, where the report projects low-double-digit to mid-teen growth to 2030. Airbnb is described as particularly well positioned given its focus on Latin America and expansion opportunity in APAC. For OTAs, Bernstein expects global room nights to grow 7–8% annually over coming years and for OTA room nights to outgrow the broader hotel industry. Hotel online penetration is approximately 66–67%, leaving around one-third of the market offline, but the report expects the historical pace of online penetration gains—about 300 basis points per year pre-pandemic—to slow to 100–150 basis points. Consequently, the OTA growth case increasingly depends on gaining share within online bookings rather than simply benefiting from online migration. Bernstein expects Booking and Expedia to represent 18% of all online hotel room nights by 2030. Consensus assumptions imply relatively modest OTA share gains in hotel bookings from 2027–28, around 50 basis points for the two major OTAs, after adjusting for Booking’s faster vacation-rental exposure. In vacation rentals, where online penetration is already high, Bernstein sees ABNB and BKNG consensus estimates implying 200–300 basis points of annual outgrowth versus the industry in 2026–27; ABNB’s estimates imply about 250 basis points of share gain by 2028, while BKNG’s imply just under 2% of additional share. EXPE’s assumed VRBO growth of 4.5–6.5% is broadly in line with its wider business and could mean vacation-rental share loss. Asset-light hotel groups retain a long runway in Bernstein’s view. Hilton, Marriott, Hyatt and IHG collectively held only 8.5% of global hotel rooms in 2025 and are expected to reach around 10% around 2032; even if recent net-unit-growth rates persist for a decade, their combined share would be only 10.8% in 2035. Their global share of hotel expenditure was 17.4% in 2025, still leaving expansion scope. Bernstein argues that brands’ higher owner margins and returns on investment relative to independent hotels make conversions an important source of growth, expanding the addressable market without requiring new hotel supply. To sustain current net-unit-growth rates, the four groups would need only a low-teens share of hotel new-build growth when roughly 30% of growth comes from conversions. The report’s historical update reinforces the broader thesis. Global lodging reached approximately 13.5 billion room nights in 2025, up 5.5% from 2024 and more than 10% above pre-pandemic levels; expenditure grew 6.9%, and APAC room nights rose 7%. Bernstein therefore remains constructive over the medium to long term: growth may be slower in 2026 and uneven by region, but the demand-supply balance is expected to preserve pricing power and favor the faster-growing vacation-rental and asset-light hotel-brand models.

Analysis framework

Bernstein updates a global lodging model spanning hotels, OTAs and vacation rentals. It links room-night demand to real GDP and consumer sentiment, compares regional demand with hotel-supply growth to assess pricing and RevPAR, and translates category growth, online penetration and market-share assumptions into implications for OTAs, vacation rentals and asset-light hotel brands.

Methodology notes

• Industry AnalysisSupply-demand framework

  Lodging demand versus hotel-supply growth

  The report assesses room-night demand against constrained hotel supply to explain expected occupancy, ADR and RevPAR outcomes, as well as vacation-rental share gains.

• Industry AnalysisVolume-price decomposition

  Room-night volumes and pricing/ADR

  Bernstein separates volume growth from pricing effects to explain lodging expenditure and hotel RevPAR growth.

• Competition & strategyEconomic Moat and Competitive Advantage

  Asset-light hotel brands’ conversion and return advantages

  The report uses the higher margins and owner returns of branded hotels relative to independents to explain why conversions can support long-term brand share gains.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Airbnb (ABNB)

  Covered vacation-rental platform expected to benefit from the fastest-growing lodging vertical.

  Strengths

  Exposure to vacation-rental penetration gains and growth opportunities in Latin America and APAC.

  Weaknesses

  Consensus requires the company to outgrow the vacation-rental industry.

  Comparison

  Consensus implies about 250 basis points of vacation-rental share gain by 2028 and 2–3% gain by 2030.

• Booking Holdings (BKNG)

  Covered OTA and vacation-rental participant expected to gain from continued online lodging growth.

  Strengths

  Exposure to both hotel online bookings and faster-growing vacation rentals.

  Weaknesses

  Further OTA growth requires share gains as online penetration gains slow.

  Comparison

  Consensus implies modest hotel OTA outperformance and just under 2% additional vacation-rental share.

• Expedia (EXPE)

  Covered OTA with exposure to online hotel and vacation-rental bookings.

  Strengths

  Expected to grow online with lodging room nights across 2026–27, implying comparatively less demanding expectations.

  Weaknesses

  VRBO growth is assumed at only 4.5–6.5%, broadly in line with the wider business.

  Comparison

  Bernstein indicates Expedia could lose vacation-rental share, unlike ABNB and BKNG.

• Hilton (HLT)

  Covered asset-light hotel brand benefiting from long-term industry consolidation.

  Strengths

  Conversion opportunity, asset-light returns and assumed 6.5% net-unit growth.

  Comparison

  Part of a four-company group with only 8.5% of global hotel rooms in 2025.

• Marriott (MAR)

  Covered asset-light hotel brand benefiting from long-term industry consolidation.

  Strengths

  Conversion opportunity, asset-light returns and assumed 5.0% net-unit growth.

  Comparison

  Part of a four-company group with only 8.5% of global hotel rooms in 2025.

• Hyatt (H)

  Covered asset-light hotel brand benefiting from long-term industry consolidation.

  Strengths

  Conversion opportunity, asset-light returns and assumed 7.0% net-unit growth.

  Comparison

  Part of a four-company group with only 8.5% of global hotel rooms in 2025.

• TripAdvisor (TRIP)

  Covered online travel company included in Bernstein’s lodging coverage universe.

Key data

• Global lodging-demand growth forecast3.6%Bernstein’s 2026 forecast, below its roughly 4% long-term expectation.
• Long-term global lodging room-night growth~4%Expected long-run growth rate.
• Vacation-rental room-night growth~8%Expected global growth through the end of the decade.
• 2025 global lodging room nights~13.5 billionUp 5.5% from 2024 and more than 10% above pre-pandemic levels.
• 2025 global lodging expenditure growth6.9%Growth in total lodging expenditure during 2025.
• Hotel online penetration~66–67%Approximately one-third of the global hotel market remains offline.
• Booking and Expedia online-hotel room-night share18%Bernstein’s 2030 forecast for their combined share.
• Combined global hotel-room share of Hilton, Marriott, Hyatt and IHG8.5%2025 share; Bernstein expects the group to reach around 10% around 2032.
• APAC lodging room-night growth8.1%2026 year-to-date growth.
• MEA lodging room-night growth-2.8% y/y2026 year-to-date decline amid regional conflict.

Impact & implications

Bernstein sees the industry’s constrained supply base as supportive of hotel pricing and RevPAR while making vacation rentals the principal volume absorber of excess lodging demand. It expects regional growth to favor APAC and Latin America, OTA performance to rely more on online-market share gains, and asset-light hotel brands to continue consolidating a fragmented global hotel base through new development and conversions.