BERLIN — With hotel performance back to or surpassing pre-pandemic levels in many corners of the hotel industry, hoteliers were naturally asking the question of whether comparisons to 2019 are still valid and important during the second day of the International Hotel Investment Forum.
But the resounding answer to that question seemed to be "yes" because the hotel industry of today still differs significantly from just three years ago. Getting the most of the shifting sands of the hotel industry could require creativity to change operations and a willingness to redefine relationships, hoteliers said.
Photo of the Day
Quotes of the Day
“The travel industry is so strong, and when you look at the last two years, you think it’s been tough, but I think the best is yet to come. Don’t forget, China hasn’t started to travel yet. India hasn’t started to travel as much as before."
— Dillip Rajakarier, CEO of Minor Hotels, qualified his optimism for the future during the CEO panel during the second day of the International Hotel Investment Forum.
"COVID did not kill buffets, and Dubai is the poster child for over-the-top buffets. They are bacchanalian. They have to be seen to be believed."
— Michael Ellis, president of food and beverage at FEBC, speaking at a food-and-beverage breakout panel of one of the few things in food-and-beverage operations that the pandemic has not changed.
Editors’ takeaways
It is probably no surprise that the major talking point, both in panels and on the conference floor, on the second day of IHIF was how to cut operating costs.
Average daily rate has pushed revenue, but the bottom line is causing pain for operators and especially owners. Energy, financing, labor and supply-chain costs all are resulting in all manner of innovative operational efficiencies.
Attendees echoed the message that the guest journey must remain as seamless as possible and experiences must not be compromised.
In no one section are these pressure points more pronounced than in food and beverage, said Guy Heksch, chief operating officer of hotel developer and owner Omnan Investment Group.
"Reducing menu sizes, having easier food deliveries and working more closely with those delivery companies, eliminating in-room dining, eliminating more steps in the F&B process and having more interaction with guests, while at all times providing a better experience for guests. It is difficult to provide this in this landscape," he said.
Ask the head of any silo, vertical or team concerned with specific tenets of the operations piece, and they will have similar innovations in place and concerns at the back of their minds.
They are also thinking, no doubt, of keeping owners and shareholders on board and happy.
— Terence Baker, news editor, Europe, Middle East and Africa
@terencebakerhnn
The recurring theme on the second day of IHIF seemed to be conflict and the need for cooperation. During the "Driving Alpha: Efficiency, Productivity, Profitability" session, Aimbridge's Chief Global Growth Officer Allison Reid was asked about rising tensions between hotel operators and owners — or more specifically asset managers. She said she didn't necessarily believe there is more conflict between the two factions — that are ostensibly working toward the same goal but with some nuance in their motivations — but also a healthy amount of tension can lead to creativity.
"Sometimes that tension is necessary ... so each side is really thinking outside the box and trying to get to the right answer," she said.
Similarly, during a later session, Felicity Black-Roberts, Hyatt Hotels Corp.'s vice president of development in Europe and North Africa, said hotel brands are being asked to take more risk in management and franchise agreements. But to make that more tenable, owners need to be prepared to make some concessions themselves. She said that could boil down to setting up deals so brands have control of properties for longer periods.
"Because as a brand, you're in the business of distribution, and we want that hotel to be there for the next 10 or 15 years," she said.
— Sean McCracken, news editor
@HNN_Sean
Hoteliers around the world have been able to count on one common denominator over the past two years, and that's the resiliency of leisure travel. Here at IHIF, the big topic of conversation isn't just the resilience of leisure travel, but the resilience of luxury leisure travel.
On the first day of the conference, we heard industry data analysts speak about the high average daily rate premiums luxury hotels continue to command, and CEOs continued that conversation on day two, really underscoring that many are going all-in on that high-spending luxury traveler.
We heard from new CEO of Jumeirah Group Katerina Giannouka about her plans to export the Dubai-based luxury hotel brand around the world, translating its expression of Middle Eastern luxury to other locations, from beach resorts to city centers.
Focusing on ultra-luxury guests and relying on the company's strong balance sheet for expansion will keep the brand expansion relevant, she said. "Guests will still know what Jumeirah is, and sense it," she said.
During potentially uncertain financial times, hoteliers always like to rely on the segments of the industry that are reliable amid change, and with this turn of the cycle, that's luxury.
— Stephanie Ricca, editorial director
@HNN_Steph
https://twitter.com/HNN_Steph