Hotels find easy money in fees and surcharges
Add-ons for minibars, Wi-Fi, etc. are pure profit
NEW YORK – Forget bad weather, traffic jams and kids asking, “Are we there yet?” The real headache for many travelers is a quickly growing list of hotel surcharges, even for items they never use.
Guaranteeing two queen beds or one king bed will cost you, as will checking in early or checking out late. Don’t need the in-room safe? You’re likely still paying. And the overpriced can of soda may be the least of your issues with the hotel minibar.
Vacationers are finding it harder to anticipate the true cost of their stay, especially because many of these charges vary from hotel to hotel, even within the same chain.
Coming out of the recession, the travel industry grew fee-happy. Car rental companies charged extra for services such as electronic toll collection devices and navigation systems. And airlines gained notoriety for adding fees for checking luggage, picking seats in advance, skipping lines at security and boarding early. Hotel surcharges predate the recession, but recently properties have been catching up to the rest of the industry.
“The airlines have done a really nice job of making hotel fees and surcharges seem reasonable,” said Bjorn Hanson, a professor at New York University’s hospitality school.
This year, hotels will take in a record $2.25 billion in revenue from such add-ons, 6 percent more than in 2013 and nearly double that of a decade ago, according to a new study released Monday by Hanson. Nearly half of the increase can be attributed to new surcharges and hotels increasing the amounts of existing fees.
Hanson says guests need to be “extra-attentive” to the fine print. Fewer and fewer services come for free.
Need to check out by noon but don’t have a flight until after dinner? Hotels once stored luggage as a courtesy. Now, a growing number charge $1 or $2 per bag.
And some budget hotels charge $1.50 a night for in-room safes.
Persuading a front desk employee to waive a fee at checkout is getting harder. Fees are more established, better disclosed and hotel employees are now trained to politely say no.
“It’s the most difficult it’s ever been to get a charge removed,” Hanson said.
U.S. hotels last year took in $122.2 billion in room revenue, according to travel research company STR. Fees only add an extra 2 percent in revenue, but Hanson notes the majority of that money is pure profit.
The American Hotel and Lodging Association says fees are common in the travel business and that its members disclose them at the time of booking.
Hotels first started adding surcharges in 1997, mostly at resorts with expansive pools, tennis courts and fancy gyms. The so-called resort fees paid for staff to set up beach umbrellas and lounge chairs. Three years later, hotels added energy surcharges to cover rising utility bills.
Hotels then refrained from adding any major surcharge for several years. But as airlines and car rental agencies made fees commonplace, hotels started to think up new ones, collecting record amounts in each of the past four years, according to Hanson’s research.
Even the in-room minibar – a decades-old splurge – isn’t safe from the new wave of add-ons.
At the Liberty Hotel in Boston a cold can of Coke from the minibar costs $5. That’s just the base price. The fine print on the menu reveals an 18-percent “administrative fee” to restock the bar.
Even moving an item in the minibar can generate a fee.
The Aria Resort and Casino in Las Vegas, like many other hotels, bills items to guests’ rooms if sensors in the minibar note they have been removed for more than 60 seconds – enough time, hotels say, to read the nutritional information and make a decision.
The Aria goes one step further. It also charges a $25 a day “personal use fee” if a guest puts their own soda or bottled water in the minibar. A guest in need of a mini refrigerator can have one delivered to their room – for an extra $35 a night.
Some hotels are bucking the trend. Hyatt’s upscale boutique Andaz chain offers complimentary local snacks and nonalcoholic drinks from its minibars.
Hotels are also revisiting resort fees, upping the price, especially at the high-end.
For $650 a night, guests at the St. Regis Bahia Beach Resort – set on a former coconut plantation in Puerto Rico – enjoy rooms with 300-thread-count sheets and walk-in closets. But that’s not the full price. There’s a $60 nightly resort charge, which provides for a welcome drink upon check-in, Internet access, the use of beach umbrellas and lounge chairs, bicycles and a daily poolside ritual iced tea service that includes fruit skewers. Guests pay whether they use the services or not.
And the fees aren’t limited to resorts anymore. The Serrano hotel in downtown San Francisco adds on a $20 per night “Urban Fee” that includes Internet, local phone calls, newspapers, morning coffee and use of bicycles.
Perhaps nowhere are hotels pushing fees further than in Las Vegas. Forget resort fees. Those are taken for granted there. Resorts like the Bellagio are learning from airlines and selling enhancements.
Want to skip the notoriously long Las Vegas check-in lines? That will be $30 extra. Want to check in early? That’s another $30. Check out late? Also $30.
And if you want two queen beds or one king bed, it will cost extra to guarantee your preference. For an extra – you guessed it – $30, the Bellagio will lock in three room preferences such as bed type, requests to be near or far away from the elevators, rooms on a high or low floor or the option to have quieter nonconnecting rooms.
Then there was the fee Hank Phillippi Ryan, a mystery writer, faced while in town to sign copies of her new book “Truth Be Told” at a convention. Before heading to the airport, she went to the lobby of the Paris Las Vegas Hotel and Casino to print her boarding pass. There a kiosk offered the service – for $7.95.
“I think I actually yelped,” she recalls. “I had never seen that before.”
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