Management Company Compensation Slows in 2023
Prior research conducted by CBRE Hotels Research revealed that hotel management companies were rewarded handsomely as the U.S. lodging industry recovered from the COVID-19 pandemic. An analysis performed by CBRE in April 2023 found that total hotel revenue increased by 153% from 2020 to 2022, while Gross Operating Profits (GOP) grew by 437%. This resulted in a 68% increase in the fees paid to management companies and brought management fees back to pre-pandemic levels. The increases in fees were largely due to the improved performance of U.S. lodging properties, which in turn triggered the payment of incentive management fees.