Chief Executives of six international hotel companies said this week during a virtual conference that with the worst of the Coronavirus pandemic now over, the hotel industry–particularly in the US–has begun to take steps forward to recovery. It is projected that the hospitality revenue peak seen in 2019 will return by 2023.
“What’s going to happen to all these conferences and group travel? People are going to come back as vaccinations go up,” said Keith Barr, CEO of IHG Hotels and Resorts. “I think we’re in a transitional period of time, and we’re very optimistic about the future.”
“We’re very bullish about the recovery of business travel,” said Tony Capuano, Marriott International CEO.
NYC’s hotel recovery is lagging compared to the rest of the country, and could take much longer than everywhere else. This is largely due to the Big Apple’s dependency on business travel, Executive Vice President of CBRE Hotels Mark VanStekelenburg told Bloomberg.
The Real Deal reports that in NYC, the occupancy rate for hotels that are open was 58.7% for the week ending May 29, according to lodging data provider STR. The rate was 87.2 percent in the comparable week in 2019. Additionally, approximately 38% of New York hotels with loans in commercial-mortgage backed securities were 30 days or more past due in May.
NYC Mayor Bill DeBlasio announced late May that suspension of the city’s 5.875% hotel room occupancy tax would start on June 1st and last for a three-month period.
“The temporary occupancy tax waiver is a much-needed lifeline that is strongly welcomed by the beleaguered hotel industry,” CEO of the Hotel Association of New York City Vijay Dandapani said. “The industry thanks the mayor for taking this much-needed step that will go a long way toward the hotel industry recovering more quickly as the pandemic wanes.”
But while the demand for hotels across the nation continue to increase, labor shortage is a major issue. The need for employees continues to intensify, but many have opted not to return.
“We have lost one-quarter of our staff to other industries,” said Hilton President and CEO Christoper Nassetta. “The unemployment rate is still very high, and staff still have health concerns.”