The biggest beneficiaries of the shift, according to travel experts, are the hotels that keep prices down by not offering amenities like restaurants or meeting rooms.

"Travel managers have told us within their companies they're moving travellers to lower-tier hotels," said Caleb Tiller, spokesman for the National Business Travel Association. "It's definitely a trend."

He said companies were taking a varied approach to the switch. Some were requiring it, others strongly encouraging it and others trying to set an example by having even top executives book more modest accommodations.

For those now staying at more bare-bones properties, the downgrading has some discomforts.

Alan Hawrylyshen, a technology applications director for a manufacturer of mobile and voice-over-Internet networks, said he had encountered a host of minor inconveniences.

At full-service hotels, where he once was a regular, Hawrylyshen said checking in was welcoming and efficient. "There was never a line. They'd be expecting you, greet you by name." Hopscotching to different hotels in search of low rates now means staying at places where his information is not already in the computer system.

According to Peter Yesawich, chairman and chief executive at Ypartnership, a travel marketing and research company, a quarter of the nearly 800 business travellers surveyed this year indicated that they were booking less expensive hotels.

The trading down has been occurring on all levels: top executives who previously may have stayed at luxury hotels are staying at full-service hotels, while middle managers who used to stay at those properties are now switching to limited-service hotels.

Data from Smith Travel Research shows that hotel room rates dropped by an average of 8.1% year on year in the first four months of the year, with rates at luxury hotels falling by 13.9% and rates at select-service hotels declining 8.3%.

Select-service hotels are also holding their own in occupancy. Occupancy rates are expected to fall across all hotel levels this year because of the recession's impact on business and leisure travel.

However, select-service hotels will end the year with less of a drop than most other brands, said Robert Mandelbaum, director of research information services at the consulting firm PKF Hospitality Research.

While overall occupancy is expected to drop by 5.6% and luxury hotel occupancy by 8.3%, select-service occupancy is projected to end the year with a 3.7% decline.

Hotel investors and developers are flocking to these types of properties because they are regarded as a relatively safe haven during a time of overall distress for the industry.

"They're cheaper to build, they're cheaper to maintain and they're cheaper to operate," said David Loeb, a property analyst at Robert W Baird & Co. He said new hotels were opening at a rapid rate and would most likely add to the problem of too many rooms and not enough travellers to fill them.

While this is bad news for hotel operators, it is a silver lining for road warriors and corporate travel managers trying to hold the line on lodging expenses in a tough economy.

Source: The Times