The contagious nature and transmission rate of COVID-19, resulting in the far reaching geographical spread of the coronavirus, demonstrates just how connected and globalised the world has become.What cost will this public global health crisis have in economic terms and how long will it take for the UK hotel market to recover to pre-COVID-19 levels?
The economic consequences from COVID-19 will be stark and hotels are likely to be disproportionately impacted. With the ongoing enforced lock down, the current focus is one of survival, with cash conservation and liquidity of immediate concern, according to Knight Frank’s Philippa Goldstein.
The range of fiscal measures put in place by the UK government, in particular the business rates 12-month holiday for the hospitality sector, together with the ability to furlough staff for an initial period of up to 3-months, have substantially reduced the holding costs to hoteliers of a closed hotel operation.
To be ready and responsive to the opportunities ahead and to provide hope at this time of great uncertainty, we take a look at how the UK hotel sector has survived past events. Whilst the immediate economic impact is anticipated by many to be more severe than past economic downturns, we outline what the forthcoming recovery may potentially look like.
With the use of HotStats data, the graph below shows London’s RevPAR performance over a 20-year period and what becomes immediately apparent is the resilience over time of the London hotel market.