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hotelAVE Q3 DASHBOARD & INSIGHTS

14 October 2020
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We dedicate our 3Q20 hotelAVE Hospitality Dashboard ® to the hotel operators and associates who work tirelessly at our hotels and the many industry associates who have been furloughed or laid off as a result of this pandemic.

  • Upside to 2020 Outlook: The industry forecasts for 2020 imply a 70% RevPAR decline for 4Q20 based on actual YTD results, while weekly trends have been averaging -50%.
  • Short Term Demand Dominates: The good news is that the short term bookings have very low cancellation rates (including group).
  • Asset Management Must Anticipate Trends: Our asset management strategies for 2021 reflect that leisure travel will exceed 2019 levels, while group will likely be negative and corporate recovery will begin in 2Q21, achieving 50% of 2019 levels in 2H21.
  • Equity Interest Outweighing Available Opportunities: As we underwrite for our equity and lender clients, we sometimes question whether recent hotel debt and equity pricing is driven by FOMO. Are investors sufficiently factoring in carry costs and outstanding payables (in the case of debt), or is investor sentiment assuming a quicker recovery?
  • Creative Packaging Induces Demand: Many of our leisure focused hotels are successfully inducing demand in the Fall thru creative offerings. These include “schoolcation” packages that provide supervised school work areas, office packages and unique cultural immersion programming. Many of our urban market hotels remain closed due to the need for a higher occupancy threshold to justify reopening and losing less money.
  • Support our Industry: With depleted reserve funds and exhausted PPP loans, more than 2/3 of hotels said they could only last six more months at current revenue levels without more government relief, according to the AHLA. Please go to AHLA to send your support for additional relief to your local representatives.

We trust that our dashboard and newsletters are providing helpful data points and guidance as you navigate unchartered waters. Our advisory, asset management and operational efficiency teams are here to help you to expedite recovery, identify creative solutions, and provide guidance on reopening or restructuring plans.

Access the dashboard here

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