The upcoming year is projected to be a better and brighter one for the hospitality industry, but what are the new factors driving the market in 2012? The landscape is evolving quickly as new technology demands that hotels become more social and engaging in their marketing efforts, travelers are looking for the best value propositions, and consumer demand is pushing for hotels to make concerted effort 0n property upgrades and improvements.Hoteliers will invest in reinvigorating properties to take Advantage of the market. After years of delaying capital expenditures, hotel companies are betting that now is the best opportunity to renovate their properties.

In 2012, we’ll see even more hotels renovating lobbies, restaurants, bars and fitness centers, as well as replacing beds, TVs, and more. Hotel sales, an absolute outcome of an improved market, will spur even more renovations since sale contracts always contain a provision requiring the new owner to upgrade the property.There will be little to no new development dollars on the debt or equity side This is good news for most, but bad news for the developers who genuinely have enviable sites in great markets. Despite that, optimism reigns. A great deal can, and will, get done.

We’ve seen it. In fact, we’re working on one ourselvesOnline booking will continue to (modestly) grow. The number of U.S. travelers booking and researching online is still growing. More than 114 million people will research travel online this year, while 94 million will actually book reservations.

While more than 50 percent of travel bookings are made on the Internet, the online travel market has matured and I expect modest growth and stabilization.There will be more mobile bookings and research. More and more travelers will be turning to their mobile devices to not only research lodging and travel options, but to book and communicate room preferences directly with the hotel. Mobile channel booking has increased four-fold between 2008 and 2010 according to Forrester Research. Plus, Google is projecting that mobile will overtake PCs as the most common Web-access device by 2013.

With travelers adopting Smartphone’s and tablets at such a rapid pace, it’s crucial for hoteliers to optimize their website for mobile usage to capture potential mobile transactions.Demand and average rate are up in most markets, but not equally distributed. The top 25 markets in the U.S., and those that were really battered at the height of the recession, have seen the most bounce by and large.

Many secondary and tertiary markets have not seen a strong recovery to date.Revenue management will make the art of managing a hotel more of a science. Revenue management has morphed from the days it was first introduced by the airline industry in the 1970s to being a complex science today. Managers have always lowered prices to stimulate sales when demand is weak and have raised prices during peak demand periods. Hotels are now able to update prices for all future arrival dates to match market demands each day, via advanced market intelligence applications.

Travel Click has pace reports for transient and group demand that look at bookings one year in advance. Plus, Smith Travel Research will soon introduce reports offering intelligence looking at future bookings, rather than solely historic figures.Proliferation of distribution channel management will large impact pricing More than ever, it will be vital for hotel owners and operators to stay on top of the distribution landscape that is expanding beyond OTAs, including popular sales vehicles such as meta-search, flash sales and mobile channels. Beyond simple awareness of the different mediums available to sell hotel rooms, hoteliers must know the costs of the variety of distribution channels and the returns expected from each.

Hoteliers must preserve rate parity and their brand by utilizing the most cost-effective distribution channels, instead of using desperate measures toBrands will put more money into deals to expand market share. The brands are at war for the development deals that have a chance to get financed. Starwood, Hyatt, and Intercontinental are aggressively pursuing the Hilton and Marriott juggernaut. Whether it’s key money, mezzanine debt or equity, seasoned developers will have their way with the brands as they fight for share of the new builds.

Prepare for growth However, know where we are in the game. We are in the second inning of the industry when compared to a baseball game with the peak or 9th inning coming in 2016...use caution from 2017 and beyond.

These next five years will see hotel values with annualized double digit growth. Demand will stabilize in 2012 but rates will grow beyond the rate of inflation. That means profits and values improve markedly.Social media will continue to transform connections with travelers. By 2016, half of the travel industry will be using social media as a way of generating revenue and bookings. Currently more than one-fifth (22 percent) use social media as a revenue generating tool with a further 27 percent planning to do so over the next five years.

Plus, social media will become more of a key component of Search Engine Results Page (SERP) algorithms.Face book’s post are Bing already integrated into search and Google+ emerged with native integration into Google search. Hotels can no longer afford to linger over adding social media to their marketing mix. It’s now a necessary element of traffic-driving success .

As the search engines continuously evolve their ability to personalize results - in the interest of presenting individual users with information most relevant to their own needs – location is one of the key factors that plays into this equation. With respect to hotels, the importance of responding to local search tendencies cannot be overstated. A property that localizes its marketing efforts to a specific geographic target – by optimizing its website for locally searched terms, claiming listings on the top search engines’ local directories and providing geo-specific visual and textual content that is of value to users– stands a distinctly better chance of converting local searches into paying guests. While mobile channels are expanding at an aggressive rate, it wouldn’t be unthinkable to suggest that desktop and laptop computers are headed in the direction of the payphone. Fifty percent of U.

S. adults and eighty percent of business travelers have Smartphone’s and tablets like the iPad, with Google projecting that the use of these mobile devices as a means for accessing the Web will surpass traditional PCs by 2013. Cairns is Far North Queensland’s key economic centre and is currently facing a number of challenges.The region has been hit hard by the global financial crisis and other factors, with impacts on all parts of the community, particularly the tourism and construction industries. A significant factor in the region’s vulnerability to the global financial crisis and other recent events is its reliance on only a few major industry sectors .

The Cairns’ Economic Future Plan responds to the impacts of the current crisis by taking immediate action to create new jobs in the region and relieve economic stress wherever possible.*This Plan builds on the foundation of existing planning initiatives, including the recently finalised Far North Queensland Regional Strategy (FNQ 2009-2031). It seeks to:Strengthen Cairns as a destination and a gateway to the world. This means building on Cairns’ existing industry strengths as well as expanding into new areas of opportunity such as its potential as a major regional hub for Papua New Guinea and the Pacific Rim.

We want to build the right foundations for the world to come to Cairns and for Cairns to reach out to the world..Our Strategy Strengthen Cairns as a destination and a gateway to the world Cairns is Far North Queensland’s key economic centre and is currently facing a number of challenges. The region has been hit hard by the global financial crisis and other factors, with impacts on all parts of the community, particularly the tourism and construction industries. A significant factor in the region’s vulnerability to the global financial crisis and other recent events is its reliance on only a few major industry sectors.The Cairns’ Economic Future Plan responds to the impacts of the current crisis by taking immediate action to create new jobs in the region and relieve economic stress wherever possible The Cairns’ Economic Future Plan builds on existing Queensland Government commitments for Far North Queensland.

The Queensland Government is already committed to a range of activities that support jobs growth and the local economy. It has already committed $1.3 billion in capital works for 2009-10, supporting 9,000 jobs in Far North Queensland. of the initiatives below were announced as part of the 2009-012 State BudgetBuilding infrastructure $65.2 million for transport infrastructure including $11.2million to redevelop the Trinity Wharf cruise liner terminal at the Port of Cairns, $13.

2 million to replace rail and pedestrian bridges in the region, $11.3 million to complete construction of a new bridge and approaches at Endeavour River, and $9 million towards the $31.5 million upgrade of the Kennedy Developmental Road, south of Mount Garnet. $82.1 million for energy infrastructure including $40 million for Far North Queensland’s electricity network and $19 million for electricity network improvements in remote Cape York Peninsula and Torres Strait Island communities.

$57.6 million for education and training infrastructure including $19.2 million to complete the $36.7 millionNew and traditional industries Supporting and strengthening foundation industries such as tourism, construction and agriculture will help protect their place as key pillars of the Cairns economy.

Aggressively pursuing emerging industry opportunities like tropical science and expertise, aviation and marine services where Cairns has a natural advantage will help diversify the economy. Cairns also has the opportunity to become established as a business hub for major developments in PNG and the Pacific Rim.Tropical expertise in Cairns – a new industry Cairns is uniquely placed as one of the few developed economies in the tropical world. Cairns businesses have designed and adapted their practices and products to the tropical environment. This gives Cairns a competitive edge in selling its expertise to the world.

Tropical expertise cuts across many sectors including tropical health, environmental management, tropical agribusiness and tropical infrastructure and design. Considerable Queensland Government activity is underway in building and promoting tropical expertise in Queensland.The $20 million Queensland Tropical Expertise Strategy 2008-2012 (Q-Tropics) identifies a range of actions needed to establish Queensland as an internationally recognised world-leader and region for tropical expertise. These include building Queensland’s tropical expertise, translating tropical research into commercial outcomes and exporting Queensland tropical expertise to the world. The Australian Tropical Expertise Consortium is an example of a Cairns-driven initiative to develop the local industry and market the region’s tropical expertise to the world.

In addition, the Queensland Government will deliver a $0.26 million Tropical Expertise Package for Cairns to host a tropical science conference in 2012 match local businesses with new tropical expertise opportunities, and work with Advance Cairns to identify new markets for local tropical expertise companies.Tourism-our strong commitment to a foundation industry The Queensland Government’s commitment to tourism is demonstrated by its Protecting Tourism Jobs election commitment and the Tourism Jobs Summit that will determine the best way to spend tourism funding to secure job creation and retention. Support for the industry is demonstrated by commitments to focus on airline route incentives, marketing and product development, tourism infrastructure and investment attraction. $36 million in additional funding over three years has been allocated to stabilise, secure and enhance the tourism industry so it remains sustainable well into the future.

Commitments include:$11.2 million to redevelop the Trinity Wharf cruise liner terminal to provide world-class facilities for visiting cruise liners and further develop Cairns as a cruise liner destination building on the existing $48 million 10-year Queensland Tourism Strategy, released in 2006.contributing $60,000 to a feasibility study and business case for the proposed Cairns Cultural Precinct marketing plans coordinated by Tourism Queensland focusing on Cairns and Far North Queensland more than $1.5 billion in tourism infrastructure as well as increasing industry funding for marketing, job creation and investment attraction. Bush camp facilities in Cape York The Queensland Government is allocating $400,000 in grant funding to develop new bush camping facilities at Cockatoo Creek and Vrilya Point, which will be a win for both visitors and the environment.

Intrepid tourists are already visiting these two sites in Cape York in significant numbers and these new facilities will help the region capture more of the drive tourism market. Development of the bush camps will include construction of campsites, installation and construction of toilet facilities, a shelter, tables and benches, rubbish bins and interpretive signage. These facilities will not only improve the experience of visitors, but reduce their impact on the local environment. The improved campsites will also offer economic benefit for local communities from campsite fees and maintenance, as well as tourism opportunities such as guided ranger tours. The new bush camp facilities will be completed by the end of 2012Initiative Key actions Position Cairns as a business gateway for opportunities in Papua New Guinea and the Pacific Rim. Build new market Lead trade missions to PNG to pursue opportunities for Cairns businesses Appoint a Special Representative for trade with PNG, supported by a dedicated Cairns-based trade agent to maximise trade opportunities for Cairns Establish a Queensland-PNG Business Group with Cairns representatives to support Queensland companies Work with local groups to develop a prospectus for Cairns to promote investment Initiate PNG Mining Procurement Engagement project to encourage purchase of supplies in CairnsBuild industry capability Continue to help Cairns-based firms work together to bid for opportunities with LNG proponents in PNG Support the establishment of Cairns as a base for Australian and international firms doing business in PNG mining Build Cairns as an aviation hub Develop strategic industry opportunities Work to attract new investment and direct routes into Cairns Continue liaison with Cairns Airport Management in developing the Cairns Airport Master Plan Seek Federal regulatory changes that support the development of regional airports, including: continuation of 24 hour operations at Cairns Airport for domestic and international passenger and cargo flights expansion of Own Stopover rights within Australia for all foreign carriers to enable them to pick up genuine international passengers and transport them between Australian regional airports Partner with Tablelands Regional Council to prepare a Development Plan for the Mareeba Airport, to increase usage and leverage industry and economic development opportunities for the region and the aviation industryBuild capability Increase industry capability for Maintenance Repair and Overhaul (MRO) for Dash-8 and similar sized aircraft and promote industry training capability Develop a business case for fibre composites training through the Cairns Aviation Skills Centre Grow the Cairns marine industryBuild regional capability Allocate $2.

5 million to establish an inshore craft training simulator and maritime safety training facility at the marine training college Develop a business case for shipping services to PNG for Cairns-based exporters Support analysis of a common user barge loading facility to handle new opportunities Capture more of the global market Continue to develop the Super yacht market to benefit Cairns-based businesses Invest in a business matching project to capture new export opportunities for maintenance and refit ($99,000) Support and strengthen the Cairns tourism industryBuild local and international markets Up to $0.5 million set aside for route development opportunities with airlines to encourage direct flights and make Cairns a more attractive destination Intensively market Cairns to east coast domestic holiday makers and agentsPursue new opportunities Finalise the Cairns Tourism Opportunity Plan to identify future directions for the industry Develop a specific annual Events Strategy for Cairns and the region to attract major events to CairnsBuild industry capability Organisations in Cairns are able to access funds from the following state wide programs which support Queensland’s tourism industry: grant funding to tourism organisations and local governments for tourism development activities ($3 million over three years) Minor Tourism Infrastructure Grants to support facility development ($1.74 million over three years) Allocate $400,000 in grant funding to develop new bush camp facilities and capture more of the drive tourism Market Deliver capability development in business diversification and survival strategies for the Cairns-based tourism industryBuilding infrastructure Investment in community and service infrastructure will maintain and enhance liveability for residents and visitors and provide much needed opportunities for the construction industry and job opportunities for the Cairns workforce.For this reason in 2009-10, the Queensland Government committed to a $1.3 billion investment in infrastructure in Far North Queensland.

This is an investment in securing sustainable, modern communities for the region. It means improved access to front line services like health, such as through the $446.3 million Cairns Base Hospital redevelopment, and will stimulate growth and meet the infrastructure needs of a rapidly growing population. These projects will create and protect public and private sector jobs to help keep Queensland strong and secure our economic foundations. World-class infrastructure in Cairns will maintain the city’s global reputation as a tourism destination and give Cairns the competitive edge as a global travel and business destination in an increasingly competitive environment.

Enabling infrastructure for industry growth, research and development, and training opportunities will support Cairns to become a supply and service gateway to the world.Initiative Key actions Establish Cairns as a player in the global tropical expertise market Increase share of domestic and global markets Deliver a $0.26 million Tropical Expertise Package for Cairns to:host a tropical science conference in Cairns in 2013 match local businesses with new opportunities in tropical expertise as part of a state wide program work with Advance Cairns to identify new markets for tropical expertise companiesBuild capability to seize opportunities Continue to fund Tropical links and its full-time Cairns-based Chief Executive Officer to develop the Queensland tropical expertise industry and work with the Australian Tropical Expertise Consortium Provide local businesses with international business development training Prioritise tropical expertise in the 2012 and beyond Smart Futures Funds roundSupport and strengthen primary industries /Build capacity and access new markets Continue to implement the Tropical North Queensland Food, Produce and Value Adding Market Improvement Strategy ($85,000)Encourage investment and provide exposure for our companies at the AgInvest Forum 2013 Develop and promote mangoes, avocados and papaya in China, Japan and the United Kingdom through the Global Markets Initiative.Build capability Work with the banana industry to improve production processes so the industry is more competitive and sustainable ($1.86 million over three years Initiative Key actions Target infrastructure that protects the unique environment oft he region and creates jobs and opportunities for local business Improve regional liveability and community services $110 million in new and accelerated infrastructures  pending in the region to:Preserve the environment funding of $42.2 million for the upgrade of sewerage treatment plants for Cassowary Coast and Tablelands Councils, including the Innisfail Water Treatment plant, to help protect the Great Barrier Reef Stimulate the Cairns construction Industry Construction of community facilities including the Manunda Police Citizens Youth Club and the Marlin Coast Neighbourhood Centre Implement the two-year road program for the Far North Region ($142.8 million) Provide Indigenous community infrastructure including Yarrabah Djenghi Subdivision Stage 3-4 (joint Commonwealth-State project totalling $3.3 million - $391,000 State contribution) Continue the expansion of hospital and health facilities in the region ($39.3 million in 200914)Cairns Base Hospital Emergency Department Redevelopment ($6.4 million)Cairns Base Hospital Major Hospital Redevelopment ($21.8 million)Cairns North Community Health Facility and Yarrabah Health Centre ($11.1 million) Consider appropriate sites for a health facility in the southern corridor Address homelessness and housing issues by coordinating the delivery of construction projects under the Commonwealth Government’s Nation Building and Jobs Plan ($52 million) and other general building activity ($31 million)Improve education facilities by coordinating the delivery of construction projects under the Commonwealth Government’s Building the Education Revolution program ($107 million already awarded; $29 million to be awarded)Upgrade the Cairns campus of the Tropical North Queensland Institute of TAFE to improve traditional trade training facilities ($28.8 million) Support the redevelopment of the Cairns CBD through construction of the William McCormack Place Building(stage 2 - $80 million) Target infrastructure that strengthens Cairns as a destination and gateway to the World