Hotel industry body calls for clear heads on road to recovery
The hotel industry’s peak body has called for clear heads and eyes to be wide open as the sector looks to recovering from the dire impact of the global pandemic on tourism.
Michael Johnson, national and NSW chief executive of Tourism Accommodation Australia, speaking at the Australasian Hotel Industry Conference and Exhibition (AHICE2020) conference in Sydney and online, said the initial shutdown of inbound markets and borders earlier this year, followed by the implementation of federal restrictions, had left tourism “decimated”.
“We need to be agile, resilient and to look clear-eyed at what post-COVID success will look like and adjust our operating structures and businesses to the new normal,” Mr Johnson told the conference.
“We now find the majority of hotels in CBDs around the country operating 50 to 60 per cent down on this time last year. Sydney and Melbourne are faring even worse, with room revenues down more than 75 per cent.”
Hotel forecasters, including STR and Dransfield, have warned it will be up to four years, or mid-2024, before the industry returns to anything like pre-COVID-19 occupancies, revenues and profitability.
The hotel sector is one of the country’s biggest employers and has been one of the hardest hit with the closure of international and domestic borders to tourists, leading to a drop in occupancies, in some states to under 10 per cent, with some hotels forced to close.
In late March, leading hotel owners and operators called on the federal government for assistance to introduce a raft of measures to urgently rescue the failing visitor economy industries from complete collapse and the loss of vital workers.
Shortly afterwards, the JobKeeper program was created and the TAA has been working closely with the state, territory and federal governments throughout COVID to help protect all workers in the industry.
“TAA and AHA’s state chief executive and presidents have worked tirelessly since this crisis working on localised responses with their various state and territory government. Their efforts to open up hospitality have been critical,” Mr Johnson said.
But amid the dire conditions and given the long development lead time, new hotels and new brands are being launched.
Speaking at the conference from Singapore, Michael Issenberg, the chairman and chief executive of AccorHotels Asia PacificAccor Hotels, revealed the opening of the first Accor Fairmont hotel, the former Chiodo’s $300 million Port Douglas resort.
“There are new classes of travellers, those who are fearless and those who fear travel,” Mr Issenberg said. We believe will be at least 24 months before things are getting back to pre-COVID levels, but there is evidence that people are still attracted to luxury hotels.”
Hotel operator Toga Far East (TFE) is also launching its new Quincy brand, with the first due to open by the end of the year in Melbourne’s Flinders Lane, opposite the Rialto hotel. The property is owned by InterGlobe Enterprises UK Limited.
TFE chief executive Antony Ritch announced the Quincy brand to the conference out of Singapore, saying it was aimed at a “generation on the go” and was a brand that “relishes individuality”.
“There will be a uniquely South-East-Asian-meets-Melbourne spin on the guest experience when the 241-room hotel opens for business,” Mr Ritch said.
David Baffsky, the director of InterGlobe Enterprises UK, said Quincy Hotel Melbourne was the company’s first foray into the Australian market and took its international hotel count to 13.
