Adapting Hospitality Assets in the Era of Climate Change: A Strategic Approach

Developed for Hotel Executive – now shared here on RLAGlobal.com.
Reprinted from the Hotel Business Review with permission from www.HotelExecutive.com
Written by Ignacio de las Cuevas

Hospitality is undergoing a profound transformation against the backdrop of a rapidly changing world, which is characterized by escalating extreme weather events, ecological overspending and intensifying geopolitical tensions over natural resources.

It is alarming that the number of climate tipping points potentially pushing our planet toward irreversible change has increased to 16 at present from just nine about two decades ago. Scientists have warned that we may have already crossed five of these points at the current rate of temperature increase, affecting ice sheets, permafrost areas and ocean currents.

Another deeply concerning development is that Earth Overshoot Day – the point at which humanity’s demand for ecological resources exceeds what the planet can regenerate in a year – continues to fall earlier on the calendar each year. It fell on 1 August in 2024, compared with 2 September in 2004 and 25 December in 1971, when tracking began. The effects of ecological overspending are clearly visible in deforestation, soil erosion, or increased carbon emissions.

Hospitality has reciprocal ties with climate change

Tourism has rebounded from the interruption caused by Covid-19 and is dynamically growing year after year, supporting a positive outlook on international arrivals and industry revenues. But the uncomfortable reality beneath this enthusiasm is that the bi-directional relationship between tourism and climate change is increasingly evident. Our industry is contributing to climate and ecological change and is also suffering from its dire effects at the same time.

Travel and tourism accounted for 6.5% of greenhouse gas (GHG) emissions in 2023, down from 7.8% in 2019, when the industry was at its peak, the World Travel & Tourism Council (WTTC) said. The decline can be mostly attributed to a 10.2% fall in the sector’s GHG intensity. Growth in tourism is decoupling from growth in emissions, but reaching net zero emission requires accelerated action in cutting absolute GHG footprint, not just intensity, the WTTC advised.

The Glasgow Declaration on Climate Action in Tourism also underscores the urgency of the situation, calling for a decade of action to halve tourism-related carbon emissions by 2030. Acknowledging and reducing the ecological footprint of the hospitality industry is no longer optional, it is imperative. We simply cannot afford to look the other way.

Building bricks of an effective adaptation strategy

The hospitality industry needs a pragmatic shift to address the impact of climate change, with a focus on implementing strict and cost-efficient adaptation measures. Taking a strategic, forward-thinking approach to adaptation is not only an operational necessity but also a unique opportunity to lead the sector into a more sustainable, resilient future.

Assessing climate risks constitutes an essential first step in this approach. Hotels located in coastal regions, for example, face rising sea levels and increased storm surges, while inland properties might encounter extreme heat or water scarcity, not to mention mountain resorts which depend on the snowfall.

One example of the several risk assessment tools owners and operators can use is the Hotel Resilient digital platform, which provides accommodations with a detailed footprint of their disaster and climate risks. It also offers support with the design of their crisis management system, implementation of protocols, facilitation of trainings and completion of audits for a potential resilience certification.

Despite the availability of sophisticated risk assessment solutions, many hotel owners lack the expertise or motivation to integrate risk insights into their decision-making processes. This trend needs to shift, as properties that fail to adapt will face declining asset values and higher insurance premiums.

Climate risk assessment is also becoming essential for hotel projects. Accor has cancelled plans to open two new properties on the island of Mykonos in Greece because of the risk of water shortages and fire hazards, it said in February 2025. "On the climate change, we do have assessment of the risk nature that we do every year,” chief executive Sébastien Bazin said, adding that the company no longer builds “in fire hazard geographies”.

Implementing strategies for climate change adaptation with a clear and results-oriented focus and avoiding greenwashing are other key points for hotels. It is good news that 91% of hotels already have an action plan in place to cut carbon emission, and 83% and 82% track their energy and water consumption, respectively, according to the 2024 Green Lodging Trend Report that covers around 20,000 hotels in 50 countries. Sustainability measures at hotels are often limited to reaching for the low-hanging fruit – such as installing energy-efficient lighting and water-saving devices, the elimination of plastic straws or stirrers, or using environmentally friendly cleaning products.

True adaptation requires deeper structural changes, such as retrofitting buildings to withstand extreme weather, redesigning landscapes to mitigate flooding or drought and integrating renewable energy sources. Unfortunately, such practices are not yet widely adopted – for example, only 6.1% of hotels use renewable sources for their energy needs, with just 1.5% relying on renewables to meet more than two thirds of their total energy demand, the 2024 Green Lodging Trend Report has found.

The most important obstacles to implementing more sufficient and meaningful changes include high upfront costs and a lack of clear data about the potential return on investment. This is an area where collaboration with industry stakeholders and public-private partnerships can play a critical role in driving broader adoption.

Repositioning assets for long-term sustainability is also an important step in an effective approach to adaptation. Adapting to climate change is about seizing opportunities, and hotels that embrace sustainable practices and position themselves as eco-conscious destinations stand to gain a competitive advantage.

About 14% of US travelers deliberately pay more to stay at a hotel that has a strong “green” programme or certification, with this share significantly higher at 23% among millennials and 22% among Gen Z guests, the State of the American Traveler 2024 report said. The portion of customers knowingly paying more for green accommodation is even higher at 25% among business travelers and parents to school-age children, the survey results showed.

Repositioning hotels and reaping the subsequent benefits requires more than a superficial marketing campaign. It involves aligning operational practices, guest experiences and brand messaging with sustainability goals. For example, offering carbon-neutral stays and sourcing products and services locally can enhance a hotel’s appeal to environmentally conscious travelers. Yet, many operators remain hesitant, fearing potential pushback from traditional guests or concerns over costs.

Leveraging technology and embracing innovative digital tools offer great opportunities for climate change adaptation in hospitality. Smart energy management systems, predictive maintenance using IoT devices, and AI-driven climate modelling are just a few tools that can help hotels become more resilient.

About 87% of hospitality leaders consider sustainability objectives an important driver of technology investments at their hotel, Amadeus found in a 2024 survey. AI in particular is widely expected to play an increasing role in hotel sustainability. In an example of just how varied its applications can be, Minor Hotels has introduced an AI-powered food waste management system in its restaurant kitchens, allowing its chefs to work more efficiently by monitoring and further analyzing surplus food.

The adoption of new technologies, however, is currently uneven across the industry, with smaller operators often struggling to afford or implement these innovations. Addressing this gap will require targeted support from governments and industry leaders.

The Hotel Carbon Measurement Initiative (HCMI), developed by the World Sustainable Hospitality Aliance, offers an easy-to-use and free downloadable tool to hotels to calculate their carbon footprint. It allows operators to calculate the hotel’s emissions in total, per occupied room on a daily basis and per meeting space area on an hourly basis. The tool can help properties to benchmark their performance, set measurable targets, complete corporate reports and also to assist customers in their booking decisions, the alliance said.

Meeting the expectations of increasingly sustainability- and climate-conscious hotel guests should be an essential target of any well-focused approach to climate change. There has been a consistent shift in customer expectations and behaviour regarding this area, and increased demand for eco-conscious practices is gradually reshaping how hotel owners and operators manage their assets.

Around 75% of customers want to travel more sustainably in the next 12 months, with 57% seeking to cut energy consumption on future trips and 54% to use more sustainable travel modes, Booking.com said in its 2024 Sustainable Travel Report, which surveyed 31,000 people in 34 countries. The portion of those who want to leave the places they visit better than when they arrived rose by 5 percentage points from a year earlier to 71% in 2024.

However, the survey has also revealed that many travelers have a sense of disillusionment, with 33% feeling that the environmental damage already done is irreversible and 34% believing that being more sustainable in a destination that is not implementing sustainability practices itself is pointless. It is also telling that many expect shared responsibility, with 43% believing that travel service providers hold the key to addressing environmental factors.

In the US, only 60% of travelers believe that human activity is responsible for climate change – this is the lowest in five years, the State of the American Traveler 2024 report said. But 59% still anticipate that climate change will impact their travel habits in the next five years. Around 16% said that a natural disaster affected their leisure travel in the previous 12 months.

Natural disasters and extreme weather events can contribute to eco-anxiety – the emotional, mental or physical distress due to the dangerous effects of climate change – which is also shaping customer behaviour today. Younger travelers are more likely to suffer from eco-anxiety, with 47% of Gen Zers worrying about the environmental effect of their travel, YouGov and The Social Hub have found in a recent survey.

Conclusion: adapting assets has tremendous benefits

The hospitality sector has a unique opportunity to lead by example in the fight against climate change. By embracing a strategic approach to climate adaptation, hotels can not only protect their assets but also inspire trust and loyalty among increasingly eco-conscious guests. Achieving this vision, however, will require a shift in mindset, prioritizing long-term resilience over short-term gains.

In summary, while the challenges are significant, the rewards of adapting hospitality assets in the era of climate change are endless. Hotels that take proactive steps today will not only future-proof their operations but also set a benchmark for others to follow.