When Hogg Robinson Group (HRG) released its six month hotel survey last week, it described the market as "proving resilient." That may have been enough to make corporates, due to start the annual round of rates negotiations in the autumn, groan at the prospect of another seller's market.
But this may not be the case. There is evidence to suggest corporates might do better this year than last.
Margaret Bowler, HRG's director global hotel relations, who drew up the report, certainly believes this.
In an exclusive interview with BTE, Ms Bowler said: "Where hotel are using dynamic pricing, flexible market pricing, we are now starting to see their rates come down. There are no precise percentage figures but look at the figures for Q1 and Q2. These show that the increases are not as big."
The figures shows that major business travel destinations like London, New York, Paris, Hong Kong, Amsterdam and Brussels all saw a slower increase in room rates in Q2 compared to Q1. For example, London rates rose by 4% from Q1 in 2007 to Q1 in 2008 but only by 1% in Q2 2007 to Q1 2008.
Paris fared the same as London but New York (6 % to 0%) and Hong Kong (13% to 1%) fared much worse.
"Major hotel groups are working with sophisticated systems to say what demand should be and at what rate they should be selling. Some of the groups did not react quickly enough in Q2 and so they may well have taken hits on some occasions," Ms Bowler said.
"In the last year prices have been going up and up and up. They might now be moving the other way."
She stresses that there are still areas which are very much a seller's market where there are "huge shortages of supply."
Moscow, again the world's most expensive corporate destination with a rate rise of 25%, and Mumbai, where rates rose by 37%, are the most obvious examples.
But, Ms Bowler said, there are other cities where the market is getting a bit softer and this should become clearer by the end of 2008 and in 2009.
Possible candidates here are London and New York. Room rates in the UK capital rose by just 2% from 2007 to 2008 while in the American city they were static over the year.
While hotels are selling out when there are major events in a city - Berlin is a prime example of this - Ms Bowler said there now "more availability closer to the arrival day" than there has been in the recent past.
This in itself has led to a change. "Hotels are now reviewing their rates where before they would walk away from clients because the rate was too low."
Another change in the corporates' favour is that hotels are now no longer so keen to tie in a rate with a minimum stay.
"There is a lot more availability so clients can negotiate their rates. The market is not falling apart but what it means is that clients are getting the rates they should get," Ms Bowler said. This could all add up to better rates either on offer in what she predicts will be an "interesting negotiating season with hotels looking to increase their market share."
In the past three years or so, with rates rising and business booming, corporates have had to increase the number of hotels in their programme to get their required availability.
Ms Bowler said this is also likely to change. "Before it was ‘how many room nights do you have to give for this rate.' Now it is ‘how many room nights will they give at this rate.'
“This is definitely a brighter picture for the corporates. Prices have been going uphill for a few years. 2008 might be the year when they start to go down the other side."
Ms Bowler also made two other points.
The first was that three-star properties would begin to mount more of a challenge to the budget chains. This was because "corporates can negotiate completely" with these properties rather than the fixed prices of the budget hotels.
The second was a shift away from venues in the Eurozone for meetings and events by countries outside this area. The reason was purely price. With the Euro having considerably strengthened against both the US dollar and the British pound, costs have gone up by 20%.
This, Ms Bowler said, could persuade conference organisers to look outside the zone.