Hilton Worldwide Holdings highlighted the situation perfectly in its recent 2Q 2021 earnings call. For the second quarter, US leisure demand exceeded prior peak levels, with rates at 90% of prior peaks. This positive momentum continued into Jul-2021 with system-wide and US leisure room nights and rate actually exceeding 2019 levels.
That trend line was already showing positive indications, but Chris Nassetta, Hilton's president and CEO, noted that business transient demand also increased meaningfully throughout 2Q 2021, with Jun-2021 RevPAR for the segment increasing 20 percentage points from the first quarter.
"We saw improving results in small and medium-sized businesses and positive momentum across larger accounts," he said.
In Jun-2021, business transient room night demand was actually already 70% of 2019 levels with rate over 80% of 2019 levels though, according to Hilton's performance data, and that progress continued in Jul-2021, with similar room night demand and rates at 90% of 2019 levels.
It is a positive sign, but August will bring its traditional business demand trough, albeit Mr Nassetta sees this as being a springboard for the further recovery of the sector.
"I do think in Aug-2021 you'll - as you always do, you will see business transient fall off a little bit, right just because people are going to be like they always do, they're going to be not travelling for business as much and going on more vacations," he said.
He described this as though as "sort of the last hurrah" before a lot of people return to work and children to school.
In the case of Accor, its chairman and CEO, Sébastien Bazin, explained on the company's own 2Q earnings call that the company similarly sees further positives for both leisure and business demand. "We have a pretty good visibility for the next eight weeks to come," he said, explaining that Aug-2021 and Sep-2021 its leisure business is "strong and stronger than we expected".
There is "very low visibility" for corporate MICE activities for the months of Oct-2021, Nov-2021 and Dec-2021 though, but. "good signs," according to Mr Bazin."You have a lot of small groups between 30 people to 80 people in regional domestic corporates clearly rebounding, asking for reservation for those months," he said.
"We still don't know whether we're going to have large 300, 400 seminars across regional. It might happen and being confirmed Sep-2021. It's still a question mark. But I really believe we probably could buffer the loss of those large event to probably gathering 100s of small groups of 30 to 50 people," he added.
Accor continues to maintain a "significant quarantine business," where governments force people who want to enter into the country to go into a hotel and they've got to pay the fees for that themselves. In Southeast Asia, it is approaching a third of its current business, according to Mr Bazin. In Singapore, "80% of our business is quarantine business," he added.