RE SOR T FEE S
some upscale hotels in Manhattan were imposing “urban destination fees” (sometimes just called “urban charges”) on guests for every night stayed. Typically the fee is $25 a night per room. Tis or similar
Reports began emerging that some Manhattan hotels were imposing “urban destination fees”
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claimed. “Disclosures on websites, confirmation emails, room service menus, ‘tent’ cards in guest rooms, and directories continues to increase,” he says. Suggestions that fees are “hidden” or “surprise” may be
due to the fact that “the categories being charged are oſten established and the amounts set hotel-by-hotel, rather than by brand – and both can change frequently.” Yet there is also a problem, Hanson believes, of guests
failing to pay “reasonable attention” to the disclosure of fees when booking. He points out that this is understandable as the “focus of many travellers is on the room rate and getting the best deal” rather than locating extra charges which may not be immediately obvious. Regulatory intervention may, however, offer some hope
for travellers to the US who feel they have been unjustly charged. As far back as 2012, the US Federal Trade Commission warned some 22 hotel companies about their disclosure of resort fees and they are still interested in the issue, according to Hanson. “Despite recent statements by industry executives to the contrary, the FTC is currently focused on resort fees,” he says. In the UK, the Competition and Markets Authority
– which investigates allegations of anti-competitive behaviour by businesses – is currently probing online hotel booking websites. In particular, it says it is looking at “the extent to which sites include all costs in the price they first show customers or whether people are later faced with unexpected fees.” An interim report is expected this summer and, if past investigations are any guide, could lead to action to increase the transparency of added-on fees. Yet it is in New York where the game has moved on from
traditional leisure resorts imposing fees to mainstream city centre hotels taking centre stage. Over the past year reports began emerging from travellers to the Big Apple that
JUNE 2 0 18
ABOVE: New York urban destination fees can be sky high
fees are understood to be charged by Manhattan hotels such as the New York Hilton Midtown, the Westin New York at Times Square, and four of Marriott’s Manhattan properties (although these were initially described as being part of a “test”). And like their counterparts in Vegas and elsewhere, they are mandatory fees not included in the published room rate. Times Square hotels are particularly likely to impose an urban charge, reasoning that it is one of the city’s most popular tourist and entertainment destinations. Te exact number of Manhattan hotels charging urban fees is believed to have surged from some 15 in spring 2016 to just under 80 in March this year, according to some online observers, although the Tisch Centre’s Hanson thinks there are only about 30. Transparency in charging is not a watchword in this hospitality market. But he said he was “surprised at the
limited resistance to this new category of fee” by travellers, although not fazed that
the major chains had introduced them. While New York’s hotel occupancy levels last year were the highest since the mid-1980s, room rates only increased broadly in line with the rate of inflation, forcing hotels to look elsewhere for extra revenue sources. So far, however, it appears that UK and Continental hotel groups have not
followed their American cousins, due in large part to the stricter legal regulations covering advertised hotel prices in the UK and EU, where quoted room rates must include all obligatory taxes and charges. Corporate travel management companies are aware of the potential problem. “At the moment it is not an issue in Europe at all as such fees have not been introduced to European corporate hotels,” explains Rebecca Lee, Hotel Supplier Relations Manager at FCM Travel Solutions. “For the few corporate hotels we’ve had this issue with in the US, we’ve managed to negotiate the resort fee out. Te charge simply doesn’t work for business travellers; if the benefits are not actually a benefit to the business traveller then they should not be made mandatory.” She adds: “Te travel manager will encourage their
travellers to book those chains that do not charge urban (destination) fees.” But for as long as the leading hotel chains sense another lucrative income stream, urban fees seem likely to remain for some time – until the next bright idea for surcharging travellers is dreamt up. Until then, President Trump will have to hope that eye-watering green fees of up to £500 a day on Turnberry’s Ailsa course can help keep the books balanced now that his hotel has had to drop its resort fees. BT
busin e s s t r a ve lle r . c o m
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