Hospitality, Travel

Global view: positive outlook on travel, support for hospitality, extended stay opportunities

It’s now been a year since Covid-19 started affecting the lives of most of the world, as the World Health Organisation declared a global pandemic on 11 March 2020, promptly followed by the announcement of a national emergency in the U.S. and most of Europe and the world entering lockdown.

The hospitality and travel sector is still trying to strike a balance between fighting for recovery and planning for the expected pent-up demand. This week brings some hope for future growth opportunities.

Return to travel

As new COVID-19 cases in the U.S. continue to decrease, travellers - and especially active travellers - are expressing less concern about air travel. They also support continued safety measures, as well as proof of vaccination as a means to transition back to “normal,” according to recent research by J.D. Power reported by Travel Agent. To note, for the first time in since summer 2020, more customers are “unconcerned” (25 percent) about being exposed to COVID-19 while traveling compared with those who are “extremely concerned” (15 percent).

Additionally, travellers seem to be in favour of a “digital vaccine passport,” with one-third (33 percent) saying I should be required and another 32 percent saying it was a good idea but should be option.

In another positive for travel’s return, according to Luxury Travel Advisor, nearly one-third (32 percent) of Travel Leaders Network’s U.S. member agency clients have already booked their next trip. Beyond these clients, an additional 24 percent are currently planning their next vacation. The vaccine rollout is also proving to be effective in getting people to travel again: Those who are already vaccinated are 20 percent more likely to have their vacation booked.

This positive outlook is much needed for companies relying on international travel to reopen, such as Mandarin Oriental whose latest results announcement saw the company’s chairman talk of continued losses and a  highly uncertain outlook, as reported in Hospitality Insights.

Supporting the U.S. hospitality sector

After a grueling 24-hour ‘vote-a-rama’ on the Senate floor, President Biden’s $1.9 trillion coronavirus relief package was approved by the Senate, and then quickly signed into law by the President. Notably, it includes a $28.6 billion grant specifically for the hospitality industry, according to Bar & Restaurant. This is the first federal grant programme specifically intended to help restaurants and bars since the pandemic began in March, 2020. Over the last 12 months, over 110,000 venues have permanently closed, leaving more than two million industry workers unemployed. This latest round of funding is a lifeline for bars and restaurants across the country, and offers hope that recovery is coming.

The United States Bartenders’ Guild (USBG) is also looking towards the future. Their newly appointed president, Kim Haasarud, spoke with Bar & Restaurant about the state of the industry, and where the USBG is going. Now that the organization is finally able to plan beyond the pandemic, they’re implementing new leadership strategies and lines of communications to make their national community of bartenders stronger and more supported than ever before. “It can be difficult to pivot,” says Hassarud, who realizes the USBG needs to provide more opportunities for income and networking for their members. “The one thing I could say about our industry is we always survive…People will give you the shirt off their backs to help their fellow bartenders.”

Growth in extended stay segment

The extended-stay segment has been a bright spot for the industry during the pandemic, and Extended Stay America maintained comparable systemwide occupancy of 73.7 percent in 2020. As such, this week’s move by Blackstone and Starwood Capital Group to acquire the brand and its paired-share real estate investment trust, ESH Hospitality, for $6 billion makes sense and says a lot about the future of hospitality, as reported in Hotel Management. A 50/50 joint venture between funds managed by Blackstone Real Estate Partners and Starwood Capital Group announced plans to acquire the 650 properties and nearly 63,000 guestrooms owned by Extended Stay America for $19.50 per paired share in an all-cash transaction. It is the latest pivot for ESA, which divided into two brands last month after years of being a single-brand vertical. Completion of the transaction, which is expected to occur in the second quarter of 2021, is contingent upon customary closing conditions, including approval of the company’s stockholders.

The acquisition is the latest in a string of deals across the hotel industry, as buyers look to take advantage of a return to something like normality in the travel industry, as reported in Hospitality Insights.

It’s all about health

While vaccine rollouts continue across the world, luxury resort brand Kerzner undertook to look after travellers’ health by launching a wellness and fitness brand. And don’t we all need  to look after our wellbeing.