A major factor behind its revisions, it said, was weak corporate transient demand.

That companies are pulling back on unnecessary spending -- a category in which some business travel can fall -- is not a surprise. The political season leading up the US presidential election is, well, fraught, and both the domestic and global economy still have their fragile points.

The second quarter delivered another lackluster round of earnings falling, as Fitch noted, at a mid-single-digit pace.

But whatever the reason companies are being very frugal with their business travel budgets and in some cities hotels are losing the edge on pricing power. That was LaSalle Hotel Properties CEO Mike Barnello's take on the issue in the REIT's earnings call for the quarter, per Fair Disclosure.

... corporate has been more sticklers in terms of their rate categories. Before they might be a little more open, if their particular rate category was sold out, to buy up at our properties. And we're seeing more and more people enforce that if the first rate, the lowest rate, is not available, they'll go elsewhere versus try to buy up at our property.

In general as rates soften, hotels lose the edge on pricing, a problem that Barnello said was beginning to happen in New York.

...the more publicized the lows of New York are, then the less confident every operator in the city feels about pricing. And that can become contagious and cause weakness. Now we've seen that before. We've seen that before in DC from, call it like 2011 to 2013, 2014, when people were concerned about the weakness there. The occupancies never waned; the demand growth in DC was still strong; and yet pricing power didn't exist. We're going through a lot of that right now in New York.

There is some good news for New York, he also said. The Waldorf-Astoria New York is about to close, he noted, with many of the property's 1,414 rooms taken out of circulation for at least three years as they are converted to condominiums.

Another local development that bodes well, from a lodging company's perspective, is the pushback from real estate companies, affordable housing advocates and condo associations to enforce short-term rental rules -- and specifically a ban of their advertisements on Airbnb.

New York

BETHESDA, MD—As second-quarter earnings come in, most lodging companies are reporting that corporate transient demand, or business travel outside of conference bookings, is weak. Fitch Ratings confirmed this trend with a new report noting that US lodging fundamentals are decelerating and, more ominously, signs of fatigue are signaling a negative turn could be ahead.

Fitch has revised downward its prediction for RevPAR based on recent trends. It now projects that US RevPAR will increase by 3%-4% during 2016 and by 1%-2% during 2017, with monthly comparisons possibly turning negative during the latter half of the year.

The first full year of RevPAR declines will hit in 2018, Fitch predicts, assuming the historical six-to-12-month lag relationship between occupancy and RevPAR declines holds.

Prior to this, Fitch had expected RevPAR to accelerate modestly during the remainder of the year, with 2016 probably coming in below the low end of its original 4% to 5% estimate.

A major factor behind its revisions, it said, was weak corporate transient demand.

That companies are pulling back on unnecessary spending -- a category in which some business travel can fall -- is not a surprise. The political season leading up the US presidential election is, well, fraught, and both the domestic and global economy still have their fragile points.

The second quarter delivered another lackluster round of earnings falling, as Fitch noted, at a mid-single-digit pace.

But whatever the reason companies are being very frugal with their business travel budgets and in some cities hotels are losing the edge on pricing power. That was LaSalle Hotel Properties CEO Mike Barnello's take on the issue in the REIT's earnings call for the quarter, per Fair Disclosure.

... corporate has been more sticklers in terms of their rate categories. Before they might be a little more open, if their particular rate category was sold out, to buy up at our properties. And we're seeing more and more people enforce that if the first rate, the lowest rate, is not available, they'll go elsewhere versus try to buy up at our property.

In general as rates soften, hotels lose the edge on pricing, a problem that Barnello said was beginning to happen in New York.

...the more publicized the lows of New York are, then the less confident every operator in the city feels about pricing. And that can become contagious and cause weakness. Now we've seen that before. We've seen that before in DC from, call it like 2011 to 2013, 2014, when people were concerned about the weakness there. The occupancies never waned; the demand growth in DC was still strong; and yet pricing power didn't exist. We're going through a lot of that right now in New York.

There is some good news for New York, he also said. The Waldorf-Astoria New York is about to close, he noted, with many of the property's 1,414 rooms taken out of circulation for at least three years as they are converted to condominiums.

Another local development that bodes well, from a lodging company's perspective, is the pushback from real estate companies, affordable housing advocates and condo associations to enforce short-term rental rules -- and specifically a ban of their advertisements on Airbnb.