BERLIN, Sept. 04, 2021International Hospitality Investment Forumbetween 1-3 September at the InterContinental, Berlin, to broker deals, launch new brands, network and discuss the trends impacting the hotel industry. Importantly, meeting in person after an 18-month hiatus due to the Covid-19 pandemic, IHIF demonstrated that the industry can set the example for the world to travel and convene - confidently and safely.
In its 23-year history, IHIF has always been where the vanguard of the global hotel community comes together. And, this year, the forum's role as the place where the sector congregates carried heightened meaning - as industry experts assembled to discuss how best to address both the challenges and the opportunities that have come out of the pandemic. Over 180 industry-expert speakers took to the stage over the three-day event, including; Tony Capuano, CEO, Marriott International, Dillip Rajakarier, CEO, Minor Hotel Group, Christopher Nassetta, President & CEO, Hilton,Christopher Norton, CEO, Equinox Hotels,David Kong, CEO, BWH Hotel Group,Federico J González, CEO, Radisson Hotel Group, Hubert Viriot, CEO, Yotel, Patrick Pacious, President & CEO, Choice Hotels Internationaland Sébastien Bazin, Chairman & CEO, Accor.The full speaker lineup can be viewed here.
The programme featured a new focus on a few pertinent matters: sustainability, health and safety, and hybridisation.
Sustainability, a major initiative across many industries, is of particular importance to the hospitality sector as it looks to the future. As well as being refenced in nearly half of all presentations, IHIF's programme also placed the issue front and centre, with four dedicated sessions, an invitation-only council meeting and a partnership with Water Aid, a charity dedicated to providing access to clean water worldwide.
And, with health & safety an ongoing consideration, the event was run fully masked and fully vaccinated, ensuring extra precaution for all attendees and staff. For those who could not travel due to current restrictions, the event also featured a hybrid approach allowing a virtual audience of over 100 participants to join globally at their own pace.
Paul Miller, CEO, Questex, captured the mood of attendees by stating that "hospitality is the core of the experience economy," and that much opportunity has come from the pandemic.
It was a sentiment endorsed by Tony Capuano, CEO, Marriott International, as he kicked off the event by setting out that, what has kept the industry alive over the course of the past 18 months, has been its people. "The most admirable thing about the pandemic is the way brands, owners and franchisees have come together to navigate the crisis," he said.
When asked how Marriott has stayed afloat, the answer, according to Capuano, was simple: its 31st brand- or its Bonvoy loyalty programme - which facilitated on-going customer engagement during a difficult time.
Shifting gears to provide an economic overview, Linda Yueh, Professor, Oxford University, shared positive data from the World Economic Outlook. This forecasts a 6% growth rate, albeit starting from a lower base, with recovery to pre-pandemic levels likely to be in 2023. She finished by setting out that the key to recovery, again, lies in people, commenting: If we can maintain employment, which is a clear challenge globally, we can avoid hysteresis.
Robin Rossmann, Managing Director, STR then shared that, so far in 2021, more new hotel rooms have reopened in Europe than in all of 2020. There is growing confidence in the market, and according to Carine Bonnejean, Managing Director, Hotels, Christie & Co., transactional volume in Europe will end the year above 2020 levels. There is also a clear rise in cross-border investment, with 70% coming from Europe and an increase in activity from the US, mainly in the distressed asset area.
According to BNP Paribas' H1 2021 hotel investment market results, transaction volumes have been on a steady rise, with attractive pricing.
Another common theme derived from the event is the projected spearhead in recovery and transaction-driver: leisure. Henri Giscard D'Estaing, President, Club Med shared that Club Med has seen double-digit growthin its average daily rate (ADR) following the pandemic, due to three reasons: safety, customer service, and an environmental focus.
Marcus Bernhardt, CEO, Deutsche Hospitality commented: "What we saw after the financial crisis is the leisure customer is the first to get out," further sharing that around 20% of the hotel group's properties are leisure focused and there are plans to grow this proportion as the world starts to travel again.
Michael Grove, COO, Hot Stats, shared that, while we know the blow felt by extended stay and limited-service was cushioned, luxury hotels are coming out of the dust quite rapidly; something that is crucial to the industry as leisure travellers continue to pay up for the experiences they have missed out on over the past year.
As growth continues in the leisure sector, IHG Hotels & Resorts, the property host and long-time patron of IHIF, has just announced its new Vignette Collection, a luxury and lifestyle collection brand for the leisure and business traveller. Wyndham Hotels & Resorts also announced its new Registry Collection Hotels in Georgiaright in the heart of Tbilisi.
While leisure continues to energise the sector, there is still much to be learned from the recent shifts in customer demands. Christopher Norton, CEO, Equinox Hotels identified what he thinks needs improving: "The challenge for the traditional luxury brand is they've got to be more innovative and, the lifestyle brands have to offer better service," he said. The only way to get it right is to swap ideas between the two concepts.
Another opportunity for leisure hospitality investment, according to Henri Wilmes, CIO, LRO Hospitality, is the need to accommodate the newly blurred lines between work life and personal life. Should a guest need to work from their luxury holiday, the resort should be fully equipped with proper workspaces.
In the "Talk of the Titans - Sharing Visions for Future Success" session, Christopher Nassetta, President & CEO, Hilton, made a great point that while leisure is leading in terms of Covid-19 recovery, it is actually domestic travel that has kept many brands afloat. "Business that was 95% domestic is now 99% or nearly 100%," said Nassetta. "In the US specifically…we have the highest RevPARs we've ever had - higher than the peaks in 2019."
While the company is performing very well in the US, it is also set for growth in Europe, leading with a plan to continue German expansion with a conversion in Invesco's Heidelberg hotel,which is set to welcome guests in summer of 2022.
A shared sentiment on Environmental, Social and Governancewas the focus of our investor panel as Will Duffey, Managing Director, JLL, Cody Bradshaw, MD, Head of International Hotels, Starwood Capital Group, Dominic Seyrling, Director, Investments, Archer Hotel Capital, Brian Kaufman, Managing Director, Blackstone, and Benjamin Habbel, CEO & Founding Partner, Limestone participated in a discussion of what's keeping them busy at the moment.
Brian Kaufman said: "One thing to keep in mind is ESG initiatives aren't just necessarily costs, there's real ROI opportunity that comes from investing in ESG, whether it's water reduction, energy efficiency implementation, we as a firm have an emissions reduction target that we're very focused on across all sectors across all assets."
The global CEO panel jumped straight into the opportunities created by the pandemic, including using the time as an opportunity to hit the refresh button. That has certainly been the case for BWH Hotel Group, who took advantage of the lockdown to rebrand some of its hotels. David Kong, President & CEO, BWH Hotel Group, gave the example of a Best Western property in Austin, Texas, which was repositioned within the trendier boutique division, Aiden to capitalise on Aiden's 30% to 40% increase in average rates. The group has also announced 20 new hotels with more than 2,000 rooms in Germany, Austria and Switzerland.
Choice Hotels International recently announced its repositioning of Choice Hotels Europe to Choice Hotels EMEAas it continues its master license agreement with Seera Hospitality, with ten new hotels planned to open within the next five years. Patrick Pacious, President & CEO, Choice Hotels International, commented on another trending topic; serviced apartments, by sharing his belief that this trend has become a permanent shift due to increasing lengths of stay.
Serviced apartments, along with co-living, co-working, senior living and other alternative asset discussions were also had simultaneously at Adjacent Spaceson Thursday 2 September. A defining theme coming out of Adjacent Spaces was that while alternative investments have always offered great opportunity, the pandemic has shown just how lucrative these segments can be. Miriam Barnhart, Product Manager, Sustainability and Experiences, POHA House, explained that while adjacent concept investment may be a newer trend, it is also a stable one. Barnhart said that these creative spaces offer a sense of community and belonging, while also making the guest feel safe.
A pioneer in "soulful travel," edyn, recently announced their expansion of its serviced apartment brand Cove into Europe with an acquisition of The Hague.The company also secured a £195m multi-asset debt facility with Blackstone Real Estate Debt Strategies and KSL Capital Partnersto support further European expansion.
Another pandemic-related subject covered at Adjacent Spaces was the ongoing migration of people from city-centre to suburban locations. The shared need here is a continued desire to work remotely but in a more social environment. Enter the hybrid model.
In our lifestyle panel, Naomi Heaton, Co-owner and CEO, The Other House, explained that hybrid models allow "for the best of both worlds" from a profitability perspective, in that long-term income is sustained through residential guests staying longer, while additional ADR gains are made through short-term transient bookings.
Village Hotels plan to capitalise on this hybrid approach in their latest conversion of the former Hilton Bracknell this December. Guests can stay, workout, meet and play all under one roof.
During a candid one-to-one conversation between Sébastien Bazin, Chairman & CEO, Accor, and Jonathan Langston, Chair, IHIF Advisory Board about "rethinking hospitality", Bazin shared what he had learned over the last 18 months: "Humbleness. Being at the helm I did not control much." He elaborated that among the chaos, he found himself enjoying seeing new leaders emerge from within Accor and learning to give control to those on the ground.
A key mission for Accor was setting up a relief fund, as Bazin knew the majority of his staff would not benefit from government support schemes simply due to their location. They launched a $200 million hardship fund which was made accessible to 290,000 employees, many of whom took advantage of the scheme - with the average award being $400.
Bazin closed with some sage advice on leading through a pandemic: make decisions from the gut, then the heart, then the brain.
Looking ahead, IHIF 2022 is set for 3-5 May 2022 at The InterContinental Berlin. Visit www.ihif.comfor more information as registration will open in the coming weeks.
About Questex
Questex helps people live better and longer.?Questex?brings people together in the markets that help people?live better:?travel, hospitality?and?wellness; the industries that help people?live longer:?life science?and?healthcare;?and the?technologies?that enable and fuel these?new experiences. We live in?the?experience economy?-?connecting?our?ecosystem through?live events, surrounded by data insights and digital communities. We deliver experience and real results.?It happens here.?
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