Many of the world’s large hotel companies have not successfully responded to the epidemic crisis. But they still want to promote the idea that it is more valuable in the global network than as an independent operator. Small operators need to accept this concept in order to seize the opportunity of the tourist peak in summer.
Many investors believe that the economic crisis is not a good opportunity, but in 2008, many companies bought in during this period.
It will be the same during the epidemic, but there is currently no wave of cheap pricing that hotel investors are eagerly waiting for. Investment funds targeting hotels announce deals almost every week, and major investment companies such as Blackstone and Starwood Capital also trade in the hotel industry.
The CEOs of some large hotel companies said they still need to wait for the opportunity.
Sebastien Bazin, CEO of Accor, like most hotel executives and industry analysts, pointed out that during the epidemic, governments of various countries took various forms of relief measures and increased the flexibility of loans, which made most hotels survive from the epidemic.
It is expected that the global travel market will be significantly improved during the peak season of this summer, when governments will gradually stop relief measures. In the coming months, hotel occupancy rates may exceed 2019 levels. In the Chinese market, the business travel occupancy rate of companies such as Marriott has been higher than in 2019 in some months of this year.
But not every hotel is like this. The recovery level of the hotel market in major cities around the world continues to lag behind leisure destinations. Bazin estimates that these potential growth opportunities may take six to nine months to emerge.
The hotel industry expects that most of the growth will tend to larger global companies such as Accor, Hyatt or IHG.
Many hotel business growth stems from conversion, that is, existing hotel owners change brand affiliation or sign a brand agreement for the first time. During the epidemic, the CEOs of all major hotel companies regarded conversion as the main source of business growth, and the construction financing of new hotels was obviously tighter than normal.
Considering how many hotel companies plan to focus on conversion, one might think that the success of conversion is limited. Some people may think that conversion will inevitably become a zero-sum game, but Hyatt believes that there are still many runways in the future.
However, as struggling operators want to take advantage of some of the benefits of larger brands, such as global distribution platforms, customer awareness, and loyalty programs, these companies and many others expect their conversion rates to rise this year.
Taken from Pinchain
Post time: Jun-15-2021