The measures taken against C19 has led to an unprecedented situation for the global hospitality industry. While cities and countries around the world are re-starting their economies, the rules of the game have changed drastically.
Five drivers are impacting this change;
- Government restrictions,
- Airline capacity reductions,
- corporate cost saving programs,
- fear of travel and
- a global recession.
But even when government restrictions are lifted, the consumer behaviour will not be the same again.
For many years the success and growth of the hospitality sector in cities was driven by a growing economy and a thriving business travel segment. Big trade shows and conferences were the drivers for weeks with excess demand. For more than a decade the real estate sector was in love with hotels capturing the extra yield of these events.
But what about the future?
The corporate segment will take years to be back to 2019 levels. Many big trade shows have been cancelled and even once they are back, the willingness to invest into those shows and the willingness to join them as visitors has been hit hard.
While all of this happened, existing hotel projects – although delayed – will continue to add supply to many city markets.
- How can cities adapt to this shift in demand?
- What will happen to the large amount of commoditised accommodation?
- How can digitalisation help to survive?