Global: With the International Hotel Investment Forum postponed until 2021, organiser Questex has launched In Sync, a two-day online event.
Kicking off the operators panel, Nicholas Northam, EVP international at Interstate Hotels & Resorts outlined the state of play for his company: “Half of our hotels are closed, those that are open are housing key workers. We are operating in a very different manner from before the crisis, rates are much lower.”
Kike Sarasola, founder of Room Mate Group said: “Two of our hotels have stayed open to guests, both in The Netherlands, where the approach has been different from other countries. The rest of the portfolio we have offered for free, in France, Spain, Italy and the US, staffed by us, to house medical staff, firemen and other essential workers. The company has dedicated itself to helping. We are getting ready to open to regular guests but we won’t open until we have tourists to cater for. We expect this to be from mid-June onwards.”
John Brennan, chairman of Amaris Hospitality said: “Roughly half of our hotels are open, catering to a broad range of key workers.”
Northam said that staffing numbers is going to be a big issue as properties reopen: “We have far too many people. We need to figure out how we are going to manage the hotels with the number of staff we have. Many of them are furloughed, or on equivalent schemes, until October. A lot of work is going in to planning how we manage their return, and finding the right balance between our employees and providing a return for owners. Profitability is going to be a big issue. We are not going to be ale to have as many people in areas of the hotel – the bars for example. Breakfast buffets are probably not going to come back. We recently received an RFP for a big conference at the end of 2021. It included a request for 35 square feet per delegate. A 500-seater ballroom will probably only be able to accommodate half of that under those terms.
Sarasola concluded: “The problem is not just for operators, it’s across the whole industry. Owners need to share the burden, as they can see the problem is affecting everybody.”
A CEO panel included David Kong of Best Western, who said: “The impact of the pandemic has been nine times worse than the aftermath of 9/11. We are providing support to our owners in the form of operational support, sales and marketing and webinars, as well as a fee waiver through the month of May.”
Keith Barr of IHG painted a picture of gradual and continued recovery, with large regional variations: “In China, all of our hotels are open, in parts of America, only 10per cent are closed, and we’re opening more than we’re closing. The focus is now on operations and improving cleaning and hygiene standards.”
Kong said one of the aftermath of the pandemic will higher cleaning costs: “They will go up even though the frequency of cleaning will be less, due to the cost of equipment such as electrostatic sprays.”
A session on the diversification of hospitality and hotelisation of real estate, saw Laura Brinkmann, VP at Brookfield, claim that “younger travellers with disposable income will be the first demand group to rebound as governments lift restrictions. In the medium to long term, hostels and serviced apartments and anyone who caters to a younger audience will do well.”
Puneet Kanuga, head of hospitality investments at Queensgate Investments LLP, echoed her thoughts: “Even though it offers communal accommodation, Generator has not been asked to close in any country. Hostels will bounce back quicker than many other sectors. Younger people are going to return to travel quickly. They are not as affected by and not as scared of the virus as other demographics.”
Hubert Viriot, CEO of Yotel, observed that “Covid-19 is accelerating some trends which were already evident in our industry – less interaction with guests, more IT, automatic check-ins, grab and go replacing room service, less frequent cleaning and so on. Customers pick and choose when they want to socialise and when they want to interact with staff. Going cashless will also accelerate this.”
Peter Heule, CEO of Short Stay Group & Yays, saw things from a different angle: “Hospitality is about real people and real experiences. The real estate is a way to showcase hospitality. Europeans will be quicker moving back to relative normality when compared with the US and the UK.”
Looking to the post-Covid hospitality landscape, Brinkmann said: “Asset classes which will prosper include student accommodation and serviced apartments. Our serviced apartment platform edyn has performed very well during the crisis relative to hotels. We are very keen on the sector, and you will potentially see us expand the platform and grown in the sector.
Asked about repurposing properties, she said: “In primary markets, most hotels will likely stay as hotels, but in secondary markets I can see there being conversions in to serviced apartments.”
Read our review of day one here.