Hotel prices in key business travel cities are set to increase again in 2025 but at a slower rate than seen in previous years, according to the latest Hotel Monitor report from American Express Global Business Travel.

The report, which forecasts average hotel rates in 80 major cities around the world, predicts that prices will “stabilise” next year thanks to a record number of new properties and an easing in inflationary pressures on hotels.

Most of the major European business cities are set for average hotel rate increases of less than 5 per cent in 2025, including London (+3.6 per cent year-on-year), Paris (+4 per cent), Brussels (+3.6 per cent), Berlin (+3 per cent), Madrid (+3.6 per cent), Barcelona (+3.9 per cent), Rome (+2.9 per cent) and Amsterdam (+2.6 per cent).

Amex GBT added that the highest increase in hotel rates across Europe is likely to come in the Nordic region due to “improved economic prospects” in 2025. It forecasts that prices in Stockholm will rise by 5.6 per cent year-on-year, while Oslo is set for a 4.7 per cent increase.

Globally, Indian cities are predicted to see some of the largest increases in hotel rates in 2025, with 8.5-9 per cent rises for cities such as Mumbai, Delhi, Bengaluru and Hyderabad. By comparison, China’s main destinations are forecast to have much lower increases including Beijing (+2 per cent) and Shanghai (+1.6 per cent).

Some African destinations are expected to see double-digit rate increases, including Lagos in Nigeria (+13.4 per cent) and the Egyptian capital Cairo (+11.9 per cent) due to high level of inflation in these countries.

In North America, New York is likely to see the highest increase in hotel prices in the region at 4.7 per cent, followed by Mexico City (+4.5 per cent) and Las Vegas (+4.2 per cent). Amex GBT partially attributes the higher rise in New York rates to the “continued block on the use of short-term rental accommodation”.

Dan Beauchamp, vice president of consulting at Amex GBT, said: “Stabilisation in the travel marketplace is good news for customers, but prices remain high and challenges persist for companies managing a cost-effective corporate hotel programme.

“Travel buyers can benefit from creative sourcing strategies, such as negotiating multiple room types, keeping an open mind on dynamic rates and using TMCs’ negotiated rate programmes to boost coverage in secondary and tertiary cities.”