The industry conversation right now is all about labour costs, AI, luxury demand and capital constraints. Understandable. But underneath all of that, a quieter crisis is building – one that will matter more over the next three to five years.

The middle has gone

A generation of mid-level managers left during the pandemic and never came back. The industry was too focused on operational fires to notice – until those people weren't there when it was time to promote.

The result is a succession gap at exactly the level that feeds senior leadership. Boards and ownership groups are looking at their GM bench, their Commercial Director pipeline, their VP Operations candidates – and finding it thinner than they've ever seen it.

When a key role opens, the instinct is still to move fast. That urgency is often the problem.

The cost of a wrong senior hire is rarely calculated honestly.

Beyond the immediate disruption, there's cultural reset, team instability and lost momentum. For portfolio operators, a pattern of reactive appointments quietly erodes asset value in ways that don't show up on any single P&L.

The best operators in 2026 are treating leadership acquisition like capital allocation – with process, patience and a long view. Building talent intelligence before a vacancy exists. Knowing who the best commercial leaders and GMs are across their competitive set, not just those actively looking, but those who are excellent, curious and potentially open to the right conversation in six months.

We're seeing this play out in real time.

Recently, serviced apartment operator Kula approached HBD Partners to support the appointment of a new CEO. Like many businesses, they found that the pool of candidates with proven CEO-level experience in the sector was limited.

However, the challenge wasn't simply finding someone with the right operational credentials. Following a detailed briefing with Kula's Chairman, it became clear that lifestyle brand experience, leadership style and cultural fit would be equally important in determining long-term success.

These are qualities that can be difficult to assess from a CV alone.

Rather than focusing solely on a small group of obvious CEO candidates, we widened the search to assess high-performing leaders operating one level below. Through extensive market mapping and in-depth assessment, we engaged a broad range of COOs and Operations Directors with the capability, ambition and leadership qualities to step into a CEO role.

Having met and evaluated every candidate presented, we were able to look beyond titles and track records to understand which personalities, leadership approaches and values would align most closely with Kula's brand, culture and future ambitions. This allowed us to identify individuals who not only possessed the capability to lead the business, but who also matched the criteria and vision outlined by the Chairman from the outset.

The successful appointment wasn't simply about finding someone with the right title on their CV. It was about identifying leadership potential, succession readiness and genuine alignment with the organisation they were being asked to lead.

That's a challenge we're seeing more frequently across hospitality.

The succession gap won't be solved by better hiring at the top alone. It requires genuine investment in GM-ready and director-ready talent – people capable of stepping up but needing structured exposure and sponsorship to get there.

Tourist arrivals are at record levels. Luxury is outperforming. Investment is returning. The demand for exceptional hospitality leadership has never been higher. The supply side hasn't kept up.

Over the next five years, leadership depth may become one of hospitality's most important competitive advantages.

The operators who address this now won't just fill roles more effectively. They'll build organisations with the depth, resilience and leadership capability to capitalise on everything coming next.