Long Hotel Rally Losing Steam as Supply Swells, Business Travel Falls

A crush of new projects weighs on room rates

A nearly decadelong rally for the hotel business is showing signs of petering out.

Hotel owners in large cities say they are getting squeezed by weaker business-traveler demand, higher labor costs and a crush of new hotel projects that is weighing on room rates.

“The floodgates have opened in terms of supply,” said Bashar Wali, principal and...