Long-term optimism, creative pivots buoy hotels

Despite the global pandemic, international hotel groups are reporting robust pipelines and new signings, while coming up with creative ways to bolster revenue sources, shared panellists at The Leaders’ Panel: The Future of Hotels Post Covid-19, part of TravelRevive.

Rajit Sukumaran, managing director, South-east Asia and Korea, InterContinental Hotels Group (IHG), shared: “In 3Q2020, we opened 80 hotels globally, showing there’s a lot of confidence in the industry. We know travel will return, and want to position ourselves well.”

Despite downturn, Marriott added around 90 hotels to its Asia-Pacific portfolio, including the Batam Marriott Hotel Harbour Bay in Indonesia (above) 

Similarly, Rajeev Menon, Marriott International’s president, Asia Pacific (excluding Greater China), shared: “This year, we opened around 90 hotels across Asia-Pacific, and we’ll continue to open. In terms of signing new deals, in 1H2020, this was up 30 per cent. This tells me that from a long-term perspective, there is confidence.”

In just Japan alone, Marriott opened 20 hotels, which Rajeev hailed as a “record”, but noted that these projects started a long time ago, which ultimately boils down to owners’ cash flow.

As for serviced apartment operator Oakwood, the company’s pipeline will see 14 properties open globally this year and the next. However, Dean Schreiber, CEO of Oakwood Worldwide, acknowledged that Oakwood already had a good base with longer-staying customers, so instead of closures during lockdowns, they had to work with owners to stay open.

He elaborated: “What is interesting is that independent owners are now seeing sanctuary in having a brand, which gets us more signings. In this period, aligning with a brand is easier (for business).”

However, amid border closures and travel restrictions, domestic travel – excluding the China market – has proved wanting in filling the gap left by international tourists. And while some hotel owners chose this downtime to renovate, others had to come up with innovative solutions to earn revenue.

Kwee Wei-Lin, senior vice president, hotels, Pontiac Land Group, and president of the Singapore Hotel Association, related how some hotel operators got creative. “They did hampers, takeaways, and even transformed into a temporary grocery shop – anything to survive another day.”

Rajeev mused: “A year ago, I wouldn’t have done takeaways from luxury hotels, but it’s things like these that will help us in the long run. The revenue we get from F&B is helping to keep business alive.”

For Oakwood, it had to brainstorm creative solutions for the short-stay crowd, such as rolling out work-from-home packages, shared Schreiber.
“Oakwood also sold the idea of space, where its apartments were self-contained and had a kitchenette, while still offering a ‘hotel-level’ pampering service,” he added.

Elsewhere, IHG worked with the government to convert a bulk of its 10 hotels in Singapore into quarantine facilities, while Marriott sealed a wide-ranging strategic partnership with superapp Grab that will see both companies progressively integrate their offerings.

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