Good luck to all the many hotels across the United Kingdom reopening today, May 17, after months and months of lockdown and almost zero revenue.
Hotels in the U.K. have been allowed to open outdoor restaurant and bar spaces since April 12, but with the weather here being mixed — very much so the case this year — all of us know that relaxation of the restrictions was no more than a plaster across a wound.
Some say the wider hospitality industry has lost approximately 200 million pounds sterling ($282 million) per day, while others have said it is only when hotels are fully open to guests and indoor diners and patrons that there will be any chance that break-even points will be reached and there will be opportunity to move forward.
Now it is up to guests to feel confident in going out and staying overnight, a condition that is not a given. New cases of COVID-19 seem to be coming from younger generations, that is, those not vaccinated, and that might be because they are the ones doing most of the socializing since restrictions were relaxed.
Posting Portugal
Last week the U.K. government announced “green” destinations — including Iceland, Israel, and, most notably for sun-starved Brits, Portugal. These are destinations British travelers could visit without the need for quarantine when they return home.
Since Portugal was announced as one of the 12 destinations on the list, agencies that market Portugal have gone into supersonic overdrive, although there is a continued Portuguese ban against visitors to Portugal due to run to the end of May.
Hotel companies are pushing their hotels in the country, one agency sent out a “Great Green List Destinations” email, another highlighted a hotel featuring “two lifelike pirate ships, a bouncy castle” — evidently calling out to the family market — and Marriott International said bookings by Brits for its Portugal portfolio increased by more than 800%.
Expect prices to increase, but perhaps not by 800%. Flights will increase in price, and airlines will scramble to add more flights to primary and secondary Portuguese airports.
This is will be especially so as the May 29 Champions League final between English clubs Chelsea and Manchester City has now been moved to Porto, Portugal. The previous match host was Istanbul, which currently is on the U.K.’s red list, that is, somewhere citizens are advised not to travel to and that would require a 10-day quarantine on returning at a designated hotel at the traveler’s expense.
Demand for Portugal has increased perhaps because five of the 12 destinations are the Falkland Islands, Faroe Islands, Gibraltar, South Georgia and the South Sandwich Islands and Saint Helena, Tristan de Cunha and Ascension Island.
Interesting, even gorgeous, destinations, no doubt, but not on most people’s travel lists.
It used to be that to reach Saint Helena, Tristan de Cunha and Ascension Island, one would have to take the Royal Mail postal ship from Cardiff, Wales, that accepted passengers on a stripped-down “cruise” ending in Cape Town, South Africa.
I have heard that onboard attractions were, and only were, deck quoits and Crossing the Equator shenanigans. Retired persons likely had the full month needed to get from Wales to South Africa and back by plane, and that trip was likely interrupted by a safari and a Stellenbosch winery visit.
Conferences Return to the US
This week Hotel News Now has featured coverage from the Hunter Hotel Investment Conference that annually occurs in Atlanta but of course was put on hold in 2020 by the coronavirus.
Our Editorial Director Stephanie Ricca attended in person, joining a whole conference of attendees all happy to return to meeting their peers and colleagues. Two other HNN colleagues followed the action remotely.
Ricca came up with a long-standing industry metric known as the Shrimp Index, which largely, I think, states that the increase or decrease in size, number or cost of shrimps in a hotel buffet or menu can be extrapolated to the overall health of a hotel’s P&L.
Russell Kett, chairman of business advisory HVS London, spoke recently of a new metric I had not heard of, which runs along the same lines, the cost of a can of fizzy pop in any hotel. The idea is that such the same brand and size of drink will cost more in a more expensive hotel, and if you multiply that by 100,000 you can more or less reach the value of the hotel.
I am not so sure how I will add to this invaluable cabinet or curiosities, but I did see a few photos emerging online from Hunter attendees having fallen asleep, which I feel shows clearly one major metric has returned to pre-COVID-19 levels.
Perhaps for every person seen napping, revenue per available room will increase in year-over-year terms, by 1%, that is, in normal trading circumstances, not the rebound from the pandemic.
Might need to tweak this a little, but I think as a metric it is in no way tired.
Feel free to contact me anytime at tbaker@hotelnewsnow.com. Find me on Twitter at @terencebakerhnn and on LinkedIn.
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