Forbes survey: COVID-19 impact on luxury hoteliers

"Safety is the new luxury" says respondent in Forbes Travel Guide hospitality study

A survey carried out by Forbes Travel Guide over two weeks in June has provided insight into the impact of COVID-19 on luxury hospitality.

The study involved the feedback of more than 430 luxury hotel General Managers and hotel executives from 64 countries, half of which were in North America, and around 20% in both Europe and Asia Pacific regions.

The Leading Edge of Luxury survey found that only 30% of hotels were fully open and a majority 41% remained closed. Of those closed to the general public, more than 70% said they were projected to reopen in Q3 2020 (38% in July, 18% in August, 15% in September).

A combined 8% said they either didn’t know when they would relaunch or flagged a Q1 2021 restart.

Those hotels surveyed that are open are struggling to fill their rooms, with nearly two-thirds indicating occupancy levels were 0-25%. Only 2% reported solid occupancy rates of 76-100%.

The Forbes study identified that the three biggest operational challenges faced or facing luxury hoteliers as a result of COVID-19 were:

  • Adapting and maintaining luxury service levels withing constraints of COVID-19 changes
  • Budget or financing to manage the crisis and continue operating
  • Budget to maintain appropriate staffing levels
Forbes Travel Guides survey

Four out of five respondents said developing new training procedures for staff (cleaning, guest interaction, distancing) and making alterations to some hotel services (reconfiguring restaurants, changing procedures in spas) were the two leading operational changes properties were considering.

Nearly all (94%) those surveyed agreed that increasing the frequency of cleaning and disinfecting procedures was necessary at their properties due to the pandemic, and 93% had provided hand-sanitation stations throughout their hotels. Interestingly, only 16% said they had made changes to their full-service buffet options.

“Safety in the new luxury,” said one respondent.

Another said: “Luxury hotels will have an advantage once everything reopens because they provide more confidence in travellers [with] respect to procedures and cleaning services.”

Palazzo Versace Dubai stepped up its health and safety protocols in May 2020

“Despite the unprecedented challenges, luxury hoteliers are feeling well-prepared and optimistic”, the survey said, citing 86% of respondents saying they were either ‘very confident’ (44%) or ‘highly confident’ (42%) they were prepared to handle an on-site COVID outbreak.

Only a small percentage (4%) said they expect it to take more than two years to return to “sustainable levels” of occupancy, staffing and operations – the largest percentage (26%) indicated it would take 10-12 months, while 19% said it would take just four-six months. Nine respondents (2%) said they had already returned to normal levels.

To view the full report, click here.

Lead image: Raffles Hotel Singapore reception

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