Asset managers’ outlook for boutique hotels
 
Asset managers’ outlook for boutique hotels
23 SEPTEMBER 2020 1:09 PM

Speakers on a panel at the 2020 Boutique Lifestyle Digital Summit shared how they are managing through the pandemic and what they expect public spaces and F&B outlets to look like post-pandemic.

REPORT FROM THE U.S.—There’s no playbook on how to manage through the COVID-19 pandemic, but asset managers have come up with strategies on how to operate their boutique properties through this crisis and are looking ahead to the future.

During the “Asset management for boutique hotels” panel at the 2020 Boutique Lifestyle Digital Summit, hosted by the Boutique & Lifestyle Leaders Association, Michelle Russo, founder and CEO of HotelAVE, said she’s focused on rebuilding total revenue at her boutique properties and is focused on the top line “in terms of creating packages that emphasize safety and cleanliness and sanitization, but where (guests) can have an experience in their room or safely distance around the property.”

She added that her company is also focused on maintaining the guest experience and “that important (online travel agency) ranking that’s critical for this asset class.”

Shift in experience expectations
While experience is a large part of the boutique hotel identity, Ellen Brown, EVP of Fulcrum Hospitality, said hoteliers have had to adapt and change.

She said bars and restaurants will come back because people are social, but the focus right now for Fulcrum is creating experiences within the hotel for those guests who are traveling.

Food-and-beverage outlets and public spaces are an important part of the boutique lifestyle experience. When asked how panelists expect to see a rebound and reopening happening for those parts of the hotel and if those experiences will change in the future, Rani Gharbie, head of acquisitions and development for The Pod Hotels, said social distancing in restaurants and the removal of buffets will be a temporary change.

“I feel that we have a short memory,” he said. “And we’ve seen it in the past in different crises around the world as well as in our own hometown of New York City. I feel that folks will forget some of the aspects and then there will be some kind of normalization around socializing and being together in food-and-beverage venues as well as other places.”

Gharbie added he’s not sure if buffets will disappear, but there might be “more consciousness around hygiene and more intelligence as a sector to stand back up quickly when another pandemic hits.”

Boutique flexibility
The flexibility of boutiques could be one advantage for the sector during this pandemic as others look to the boutiques for creativity in terms of technology, F&B and more, Brown said.

Boutique hotels are closer to the assets and can get things done faster—like implementing new technology that might help get properties through the pandemic—than the brands can because it’s taking much longer to get brand approval, she said.

Advice for hoteliers
For those hoteliers who might not have been around for past downturns, Russo said her advice for them today would be to pay attention to the fundamentals.

“Right now, I feel like the investment side is ahead of the fundamentals,” she said. “So have some patience and pay closer attention to the fundamentals.”

Gharbie said “what we’re going through right now made me realize I should be looking to them for guidance opposed to them looking to me for guidance.”

From an investment perspective, he said hoteliers should “always be ready for black-swan events.”

“Be aggressive but be cautious when you’re structuring your deals,” he said. “Relationships are a key factor when you’re setting up deals. Stay close to your equity partners, to your employees (and) to your lenders.”

Read more about financing and the recovery outlook from the 2020 Boutique Lifestyle Digital Summit.

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