Has this crisis shone a light on the risk associated with hotel investment?
"The current state of the industry has not been transient. Conversations about Mixed-Use, essentially a Real Estate conversation, have occupied the industry domain in the past few years. Earlier, the square meters and per cent of components were the sole focal point. However, as of late, supply has been increasing much faster than the demand with the latter marking drastic transformations. Almost overnight, the world witnessed what a self-sufficient ecosystem truly means. The real estate discussion has undergone a paradigm shift into how to build up a "perfect" building: meaning creating a livable, workable and visitable space, where retail, and food and beverage outlets are all tailored to the target audience of the building and the local community.
"This mindset needs to be brought back to hotel investments, where multiple conversations about hotel lobbies persist, but too little attention has been given to maximising the m2 and to the way to convert floors and spaces that run too low occupancies, or are too costly and have a swimming pool, a meeting floor, etc. These new approaches will create opportunities for cross-industry collaborations and will therefore enhance the use of the hotel asset. It's no longer good enough to "just" build a hotel, with outdated standards or requirements which were developed years ago. Hotels need to be able to adjust their areas with the shift in demand. This is the real evolution happening now."
What investment opportunities do you foresee emerging?
"In addition to what I have just mentioned, there will be increasing opportunities for hospitality in the health care space, the technology field, and the local supply chain."
Will there be a reluctance to invest in a business that can be completely shut down in two weeks through no fault of its own?
"Times of crises bring opportunities for some organisations based on their cash flow, location, flexibility and agility. I believe that people will continue to invest in the hospitality industry, but they will be more conscious of who they partner with and which brands they pick, what location they opt for and what would be their chosen playbook on how to create additional revenue streams. In the last few years, scale and growth have been about "buying growth" and this feature, I believe, will definitely mark a slowdown. People will narrow and monetise, relook at every angle of their business, and decide what they need to do in-house and what can be outsourced, if the partner is the right one, and distribution channels alone, will no longer be the only criteria to select an operator."
How do you envisage this will change travel behaviour?
"People will travel with purpose, not just because they are so used to it but because the speed of life wasn't allowing them to rethink this prior to Covid. Checking in and checking out together and having breakfast together has stopped making sense for years. Since we all come from different time zones, hotels are forced to re-look at customizing these services to the benefit of the consumer. People will be more cautious to leave their residences, hotels, and will start to "cocoon" , which basically means that their usual shopping or meetings etc. will need to come to them, vs them going to get them. Which will also have a strong impact on Services/Branded residences, supplying 24/7 from one location with a meeting facility, a nanny, breakfast arrangement, or a diet meal. There will be an impact on the connecting with services/supplies, who can deliver this locally at any time. Once the world opens and people return to travel mode, the length of stay will probably increase but the travel frequency will drop."
What is your hope for the hospitality industry in a post COVID-19 world?
"That the trends we have been talking about for the past years, tangible practical technology, sustainability over and above some fancy ideas for plastic straws, will go much further. Working from home, dropping carbon footprint, creating a more strong focus on families will be key. Equally important will be to introduce local transparent supply chains, and the development of ecosystems, which are in the hands of developers and not in the hands of some "Tedtalks" type organisers."