Dear Insiders,
This issue is hopefully able to rein in some fears and curb the feelings of panic before the next wave. The hotel sector is going under, though known hotels continue to go out of business almost every week now. "This is a normal process of market consolidation," Martina Fidlschuster says soberly. And in place of the oft-predicted big wave of insolvencies, she doesn't see many small waves coming either.
Every group is currently polishing its portfolio and scouting out shaky hotels, mostly in secret. Obviously though, taking the example of Flemings hotels this week: Those who rely too heavily on one location run a higher risk in the crisis. And in the case of the large Ellington Hotel in Berlin, it was probably more a question of the mega-property in a prime location and thus a change of use.
Despite such misery though, the pipelines for the cities are still full, so the loss of the 285 Ellington rooms won't even be noticeable. And there are always new players like Renditus on the market who first put out feelers and then make targeted use of synergies.
Martin Winkler, CEO of Austria Trend Hotels, says: "If you expand by hook or crook in locations where you need 80% occupancy to cover your costs, you're going to have problems." The thinking in Austria is similar. Verkehrsbüro, the parent company of ATH, the serviced apartment group Harry's Home and the private Ipp Hotels want to and will continue to expand. They all solved their problems around rents/leases, government subsidies and employees in their own different ways. Crisis is the mother of all invention.
The same applies to the Global Hotel Alliance, which, with its network of international hotel chains, stands back to look at the broader picture each day. CEO Chris Hartley senses that more and more independent business are looking for a strong shoulder in distribution and loyalty. With NH Hotels as new shareholders, the consortium is set for huge growth as, among other things, NH merges its rewards programme with GHA's. GHA wants to be the alternative to Accor's ALL and Marriott's Bonvoy. More "local experiences" and the new "Discovery Dollar", which can also be used to pay at home, are intended to help. GHA introduces its own loyalty currency. Crisis is indeed the mother of all invention.
Even as the UK's corona case rate climbs towards 500 four days after "Freedom Day", hospitality insiders are slowly turning their attention back to the Brexit fallout. Their biggest drama: the European employees who have left. A current study analyses the immediate future for British hoteliers with data and identification of the weak points.
Landing a coup in a crisis usually means being so solid yourself that partners will pull you along, despite a loss of liquidity. Motel One is now also available in New York - a mega step and a mega compliment for the Munich-based budget lifestyle group. Its first hotel in the USA! It is moving into the previous Courtyard at Marriott at the World Trade Center. The tenant was obviously in trouble, and owner Union Investment terminated before the end of the lease. Motel One follows Marriott. It shows investors as well as the mega-chains: Size doesn't matter anymore. Crisis is both risk and opportunity!
And this is especially true for the subject of sustainability. The destroyed villages and valleys in West Germany, together with the more than 170 dead, is a tragedy that cries out for change. "We must not only announce plans, but act on them too!" says ex-hotelier Wolfgang M. Neumann, today Chairman of the Sustainable Hospitality Alliance. Change is a matter for the boss, needs a leadership strategy, teamwork and clearly defined responsibilities. He will explain how hotels can do this at the HITT Think Tank on 13/14 September.
And an update on Expo Real in October: 12 companies have now confirmed their participation in our joint stand. New additions are Premier Inn and Primestar. More on our page 1.
We wish you a pleasant week full of opportunities!
Yours, Maria Pütz-Willems
editor-in-chief
Your opinion? maria[at]hospitalityInside.com
