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by Lisa A. Grimaldi | March 01, 2012
By the Numbers

Following is a sample of resort fees  at U.S. properties:

$25
Grand Hyatt Kauai Resort & Spa
Kauai, Hawaii

Grand Hyatt Kauai Resort & Spa


$25 Terranea Resort
Rancho Palos Verdes, Calif.

Terranea Resort


$27 JW Marriott Desert Springs Resort & Spa

Palm Desert, Calif.

JW Marriott Desert Springs Resort & Spa


$28 Bellagio
Las Vegas

Bellagio Las Vegas


$60 W Retreat & Spa–Vieques Island
Vieques, Puerto Rico

W Retreat & Spa Vieques Island

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Last year, U.S. hotels collected a stunning $1.8 billion in surcharges and fees, according to a recent study. And a significant portion of that sum came from resort fees, the daily charges imposed by hotels to cover amenities like gym access, Internet use and daily newspapers, according to the survey's author, Dr. Bjorn Hanson, divisional dean at the Preston Robert Tisch Center for Hospitality, Tourism, and Sports at New York University.

The total might be startling, but the fact that hotels and resorts are levying such fees at a dizzying pace surprises few meeting planners. More than half of the 144 respondents to a recent M&C Research poll said resort fees have become more prevalent in the past year. (For full survey results, click here)

And more will join the bandwagon this year, Hanson predicts, as hotel executives scramble for ways to boost revenues when there is so much pressure on room rates. Such fees and surcharges emerged as an industry practice circa 1997 (in some cases as an "amenities tariff"), says Hanson, and they have grown every year except for periods after 2001 and 2008, when lodging demand declined. Resort fees typically fall between $15 and $25, but they can be as high as $60 in some high-end venues.

Now, even properties that can't be considered resorts are tacking on the extra charge. "These hotels might have a golf course or just a larger than normal fitness center and charge resort fees," notes Hanson. In a few cases, he says, properties are charging fees per person, rather than per room. This can add up when attendees share rooms or bring a spouse or guest.

Meeting professionals are understanding -- up to a point. "Just like airlines, everybody is trying to get as much revenue today as they can," says Mimi Almeida, an independent planner based in Walnut Creek, Calif. "I don't blame hotels for charging resort fees, but it is up to us to get the most value we can obtain for our groups."

However, she and other planners take exception to five-star properties charging a resort fee for items that traditionally have been complimentary, such as nightly turndown service. And they want to negotiate, particularly when the fee covers services attendees won't have the opportunity to use.

And planners get cranky when hotels won't budge. In fact, 44 percent of those polled by M&C are less likely to book a hotel or resort that refuses to reduce or eliminate resort fees for their groups.

To fee or not to feeMichael MassariIt's not surprising that most major hotel chains and individual properties contacted for this story declined to comment on this controversial topic. On the other hand, those that have taken a stance against ancillary fees are very happy to talk. Caesars Entertainment, for one, openly eschews the concept of resort fees and does not impose them at its eight Las Vegas properties (including Caesars Palace, Planet Hollywood, Harrah's and Bally's). The no-fee policy is a cornerstone of the company's selling strategy to the meetings market, says Michael Massari, senior vice president, Caesars Entertainment.

"We are in the hospitality business, not in the business of bucketing things up and charging planners for things they may or may not use," says Massari. "I believe our job is to identify what our customers want and deliver that. We never charged resort fees in the Vegas market. We just became more public about it recently." Instead of all-encompassing fees, Massari explains, Caesars properties give planners the option of choosing the services they'll use. "Some of them are value-added, some come for a fee, but the key is someone isn't deciding for you which ones you will get."

Given the lucrative revenues resort fees generate, Massari admits that failing to impose them is a hard business decision for properties to make, but "for us, resort fees are too big a dissatisfier. They are not hospitable and they are not transparent." Caesars' research, adds Massari, shows that overall customer loyalty and satisfaction have increased as a result of the policy.

For many hotel companies whose individual properties make such decisions, it's more complicated. "There's no consistency, even within the same brand," says Nikki Nestor, president and CEO of Carlsbad, Calif.-based World Class Travel by Invitation. The amount charged -- and what it covers -- can vary widely.

At Marriott, just 30 resorts in the company's global portfolio of 3,600 properties charge a resort fee, says a spokesperson, and those are in locations where such charges are the norm. The fees, which vary by property, can cover services such as parking, phone calls, use of the fitness center, bottled water, beach chair service, shuttles, guided hikes, driving range access and Internet service.

At Joie de Vivre Hotels, which has a portfolio of 30 boutique properties and resorts chiefly in California, only three hotels charge resort fees. "It's up to the property to decide if there will be a fee," says a spokesperson. At the chain's Saguaro Palm Springs (Calif.), which opened last month in a leisure destination, resort fees are $18 per room, per day, and include parking, Wi-Fi, yoga, access to the exercise room, local phone calls, pool service and towels. "We will be flexible on this with groups, depending on size and time of year," says Joseph Jenci, director of sales.

At the 60-room Ventana Inn and Spa, a Joie de Vivre property in Big Sur, Calif., the resort fee is $28 per day and includes morning yoga, a guided property hike, a hosted wine and cheese reception, and shuttle service to local shops and restaurants. Fees are extremely important to the property's overall revenue base, says sales manager Francisco Carrasco. However, he adds, he is "somewhat flexible" about negotiating or eliminating them for meetings or incentives -- particularly if the business brings "high group room rates and a large number of room nights." (For more insight, click here.)