DLA Piper wasted no time dampening the spirits of attendees of the International Hospitality Investment Forum yesterday in Berlin. During a press conference (which I missed to conduct an interview with Rezidor chief Kurt Ritter), the legal service provider released its sobering 2009 Europe Hospitality Outlook Report.
Among other dire findings, the survey of 261 European hotel executives revealed that 84 percent of them described their 12-month outlook for the European hotel industry as bearish, while nine in 10 said they do not expect the industry to rebound in the coming year.
Additionally, 79 percent of respondents predicted hotel-chain bankruptcies in the next 12 months, with four in 10 anticipating five such bankruptcies.
Had I known there would be so much pessimism awaiting me in Berlin, I would have opted for the feel-good, cinematic romp “Madagascar: Escape 2 Africa” during my transatlantic flight to balance things out.
But to be fair, the DLA Piper report wasn’t the first harbinger of doom Monday. That came compliments of Roger “Dr. Death” Bootle, managing director of Capital Economics, during the opening session.
Some, ahem, highlights:
• “This is going to be the worst outturn for the global economy since the Second World War.”
• “There are some pretty massive uncertainties in all of this.”
• “I think things are going to be grim.”
• “My own view is that the euro is going to weaken.”
In case you haven’t already figured it out, Bootle’s nickname comes from his decidedly downbeat economic perspective.
Now, not everyone at IHIF shared the speaker’s pessimism. There was the usual laughter and lighthearted banter emanating from the exhibitor floor. There was also talk of good buying opportunities for well-capitalized investors (a belief shared by eight in 10 of the survey respondents). But after speaking with a number of attendees throughout the day, it seemed clear that members of the European hotel industry were, as Bootle called them, “confidently gloomy.”
So then, perhaps the DLA Piper report did nothing to dampen the spirits of the some 1,550 attendees. From what I gathered, most were dampened well before arrival.