Hoteliers expect group business to return in late 2021
 
Hoteliers expect group business to return in late 2021
06 JANUARY 2021 9:50 AM

With group business at hotels in the U.S. expected to pick up later in 2021 and into 2022, hoteliers in the interim are offering live streams of events and following safety guidelines.

REPORT FROM THE U.S.—Group business was nearly nonexistent in 2020, but hoteliers are preparing for its likely return in the latter part of 2021 and continued growth in 2022.

Ginny Morrison, VP of sales and marketing at Spire Hospitality, said her company’s group business in 2020 was about 30% of prior years.

For 2021, Spire has about 60% of the business that it had on the books at the same time in 2019, she said.

Morrison said the company predicts a phased recovery for its hotels and the industry overall.

Spire’s booked group business for the first quarter of 2021 is at 24% of the prior year, and expectations grow as the year progresses (with levels at 47% of the prior year in Q2, 84% in Q3, and 112% in Q4), she said.

“We definitely see the second half of the year being on the road to recovery and a lot more confidence in what we have,” she said. “There’s some risk in the business we have in the second half of the year, but we feel a lot more confident about a lot of business on the books at this point.”

Leticia Proctor, SVP of sales, marketing and revenue management at Donohoe Hospitality Services, said her company expects group business to materialize in the second quarter of 2021.

The smaller corporate groups might return in May or June, but that’s dependent on the availability of COVID-19 vaccines to the general public as well as state and local regulations on pandemic restrictions, she said.

Conventions business
State restrictions have forced changes in how companies organize and host events, which has made the segment risky, Morrison said.

“It’s mainly due to the size and structure of the meetings,” she said. “There’s a lot of gathering opportunities, and they just needed to rework how they were going to do that.”

Lee Hunter, COO of Hunter Hotel Advisors, which hosts the annual Hunter Hotel Investment Conference, said adjustments have been made for 2021.

When conferences will take place will depend on “where you are in the world and how you’re dealing with (the pandemic),” he said.

Things will be different because there won’t be the usual 2,000 attendees with approximately 1,200 seats in the general session, Hunter said. Chairs will have to be 6 feet apart; meals will have to be boxed or plated rather than being served buffet style; and the overall physical outlay of the conference will be different.

The brands will also be sending fewer people based on budgets, meaning the eight complimentary registrations that are given out won’t all be used, Hunter said.

Hunter Hotel Advisors is planning to offer a live stream of the event, which will allow people to attend online.

People are fatigued from Zoom calls and working remote, and want to travel and get out. Many are hopeful once vaccine distribution ramps up, the industry “gets back to doing that,” Hunter said.

Organizers of the event announced on 6 January that the 32nd Hunter Hotel Investment Conference would be rescheduled for 10-12 May 2021 at the Atlanta Marriott Marquis. Proctor said Donohoe is “guardedly optimistic that Q4 conventions will materialize,” but many major conventions that were scheduled prior to that have canceled.

If large conventions don’t take place in Q4, the company is shooting for 2022, she said.

Social groups
Smaller gatherings and micro weddings were a trend in 2020 with group restrictions and social distancing protocols in place across the country.

Looking to 2021, Morrison said there’s a good booking pace for weddings.

Some resorts are almost at capacity for weddings next summer and fall, and Spire is focused on shoulder dates and future dates in 2022 and beyond, she said.

The weddings on the books are normal-sized, regular weddings, she said.

“I think people are ready to move on and plan some good things,” she said.

Proctor said “minimonys”—weddings involving groups of 10 people or fewer—or micro-weddings are trending, with smaller groups adhering to state and local regulations while also allowing people to attend online via Zoom links.

In Q3 and Q4 of 2021, Proctor said larger wedding groups are on the books at Donohoe properties.

Donohoe also has booked reunions and some student groups in the latter part of Q2 as well as Q3 and Q4, Proctor said.

“The thought is, with the vaccine becoming available, that pent-up leisure demand and group demand will start to resurge,” she said.

Preparing for the return of groups
Proctor said hoteliers and meeting planners need to focus on cleanliness and safety.

“From the hotel perspective … you have to still provide high service levels with reduced staffing models, because guests when they travel, they still expect that,” she said.

Since travel is expected to improve in 2021, hoteliers need to be prepared to handle the increase in demand well, she said.

“We can’t get comfortable in this environment where we’ve been with reduced group levels,” she said. “We have to be forward looking and forward thinking and know that when it starts to pick up that we have the staffing models to service those groups in addition to safety and cleanliness protocol being front of mind.”

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