- Marriott: COVID-19 pandemic is having a 'more severe and sustained financial impact' than 9/11 and the 2008 financial crisis, combined
- Hotels will lead the recovery for tourism and then business travel, rather than airlines or cruises
- Leonardo Hotels paints picture of European recovery with portfolio growth in Central Europe
- Data metrics - latest performance insights from STR
- News briefs - bitesize updates of latest industry news and developments
Marriott: COVID-19 pandemic is having a 'more severe and sustained financial impact' than 9/11 and the 2008 financial crisis, combined
Marriott International has put clearly how big an impact the current Covid-19 pandemic has had its business. In an update to its global workforce on the continuing impact of coronavirus the company explained the "unprecedented event" is having "a more severe and sustained financial impact on Marriott's business than 9/11 and the 2008 financial crisis, combined". Like all in the industry it took a number of steps to adapt and strengthen its business including reducing costs significantly and improving its liquidity, but it has now revealed the need to implement additional measures. These, which include furloughs and reduced work week schedules which began in Apr-2020 being extended through to early Oct-2020, are, it says, in light of the "increasing likelihood that it will be some time before lodging demand and RevPAR levels recover". Marriott warns that prior levels of business "will not return until beyond 2021".
Hotels will lead the recovery for tourism and then business travel, rather than airlines or cruises
While there's no clear roadmap for what's ahead as we all work to move collectively forward, travel industry technology provider Sabre Corporation has highlighted some research that showcases the role that the hotel sector will play in the recovery. Citing the recent survey from MMGY for the US Travel Association, it highlights data that shows more than two thirds (68%) of the people surveyed felt safe travelling in their car, compared to just 14% for domestic flights and only 10% for international flights. This finding "supports the important and strategic role hotels will play in our global recovery as leisure travel to local getaways will be the earliest sign of returning demand," explains Justin Ricketts, SVP product development at the company's Hospitality Solutions business. According to Mr Ricketts, recent industry reports show that "hotels will lead the recovery for the tourism industry, far sooner than airlines and the cruise industry". Leisure travel to local getaways will be the earliest sign of returning demand, followed later by business travel as companies start to restore, build sales, and advance their working relationships with customers.
Leonardo Hotels paints picture of European recovery with portfolio growth in Central Europe
Many hard and dramatic weeks have passed for the management team at Leonardo Hotels, which like others in the accommodation sector had to make quick decisions on the operation of properties across its portfolio. Several hotels at key locations have remained open throughout the shutdown, but now the company is gradually opening more from week to week. Despite all the ongoing challenges, Leonardo Hotels says it still plans to add more hotels to its Central European portfolio over the course of this year. The Leonardo Zurich Airport opened a few days before the outbreak of the pandemic and then had to be closed immediately, but will reopen its doors as soon as flight operations have stabilised. The Leonardo Verona in Italy will be integrated into the Leonardo brand family following extensive renovation work with a new look and feel concept in Jul-2020 or Aug-2020. At the same time the Leonardo Dortmund will open in a central location in the city, while the NYX Hotel Warsaw is scheduled to open in Sep-2020.
Data metrics - latest performance insights from STR
- Hotels in Africa reported unprecedented performance lows during Apr-2020. In comparison with Apr-2019, occupancy declined -79.8% to 12.5%, ADR was down -31.1% to USD77.85 and RevPAR fell -86.1% to USD9.75. These were the lowest absolute occupancy and RevPAR levels for any month on record.
- The Asia Pacific hotel industry reported record lows in the three key performance metrics during Apr-2020. In comparison with Apr-2019, occupancy fell -60.3% to 28.0%, ADR was down -44.8% to USD54.97 and RevPAR declined -78.1% to USD15.38. The absolute levels in each of the three KPIs were the lowest for any month on record in the region.
- The Central and South America hotel industry reported historic performance lows during Apr-2020. In comparison with Apr-2019, occupancy was down -79.7% to 11.6%, ADR slipped -28.7% to USD61.83 and RevPAR was down a significant -85.5% to USD7.17. The absolute occupancy and RevPAR levels were the lowest for any month on record in the region.
- The European hotel industry reported unprecedented performance lows during Apr-2020. In comparison with Apr-2019, occupancy was down -84.6% to 11.1%, ADR fell -30.1% to EUR77.52 and RevPAR hit lows of -89.2% to EUR8.58. The absolute occupancy and RevPAR levels were the lowest for any month on record in Europe.
- Hotels in the Middle East reported unprecedented performance lows during Apr-2020. In comparison with Apr-2019, occupancy was down -58.0% to 31.2%, ADR fell just over a third, -35.1% to USD95.54 and RevPAR fell -72.7% to USD29.82. These were the lowest absolute occupancy and RevPAR levels for any month on record.
News briefs
- Luxury hospitality company, Cheval Collection, has announced expansion in Scotland as part of a long-term strategic vision for UK and international growth. Building on its London portfolio of 512 apartments across its eight residences in the English capital, from Jul-2020 it will add The Edinburgh Grand and Old Town Chambers to its portfolio. The premises, currently marketed under the Lateral City brand, add a further 100 new apartments to the Cheval portfolio.
- Croatia has reportedly opened more than 130 hotels this past week and plans to conduct work on attracting visitors from key markets. Croatian Tourism Association director Veljko Ostojic said a good epidemiological situation is key to achieving results in 2020 and Croatia is among the European countries with the most favourable conditions.
- The European Hotel Managers Association has expanded a decade old agreement with Diversey to ensure "revolutionary cleaning and hygiene technologies" as the hotel industry resumes business. The Enhanced Cleaning and Disinfection Guide will ensure that any hotel creates "a healthy and welcoming environment" for guests.
- The 103-room Fairfield by Marriott Inn & Suites Camarillo property has opened in the United States of America, managed by Plantation Bay Hotels. Located 45 minutes northwest of Los Angeles and 40 minutes south of Santa Barbara, the property offers guests easy access to downtown Camarillo, the Camarillo Premium Outlets, Ventura State Beach, Channel Island Harbor and Point Mugu State Park.
- Hotelbeds has announced plans to launch 'Safe Stay' in the coming weeks to help support the recovery of the travel industry. Safe Stay is a distribution filter category that consolidates and displays in the booking process the different COVID-19 health and safety protocols and certifications that travel industry companies, tourism boards and lobby groups have recently created. The category covers both accommodation and providers of services such as transfers, activities, theme parks and car rental.
- LHG (London Hotel Group) has won planning permission to expand its aparthotel scheme on Tooting High Street, bringing 373 guest rooms across six floors with basements to one of London's 'coolest neighbourhoods', popular with both residents and tourists alike. The previously consented aparthotel scheme will now include the adjacent site of the former Tooting Constitutional Club. Work is expected to start on site in Nov-2020.
- MP Hotels has teamed up with global leader in hygiene, Ecolab and the internationally renowned health, safety and hygiene certification body, Cristal International Standards, to launch its Clean 2.0 project to reassure guests in the current Covid-19 environment. The programme will offer in a POSI (Prevention Of Spread of Infection) certification for all the hotels and a daily room check assurance tag for every new guest entering their room.
- New research from Rentals United has found a sift in bookings to domestic travel and mid-term rentals during the industry's initial recovery and rebuilding phase. It says it has seen a 20 percentage point year-on-year increase in guests travelling within the same country. Furthermore, it has seen short-term rentals increase their average stay duration in comparison with last year.
- Hospitality Ventures Management Group (HVMG) has been awarded management of the currently under-construction, 104-room Residence Inn by Marriott Waco/South in Texas. Owned by Heritage Hospitality Group, the four-story property situated within the Central Texas Market Place development, is expected to open in in Jul-2020.
- The Royal Portfolio hotel collection in South Africa has announced a new programme offering travellers 'bonds' (vouchers) for future stays at its four luxurious properties across the country. As part of the hotel group's commitment to the local and greater community, each voucher from the Royal Malewane, Birkenhead House, The Silo and La Residence will also include a donation to The Royal Portfolio Foundation, funding counter-poaching initiatives and food donations to vulnerable communities.