In this roundup of news from Europe: Hotels in France, the United Kingdom and other European countries begin to open up; deals and development continue; and more.
Hotel News Now each week features a news roundup from a different region of the world. This week’s compilation covers Europe.
Travel corridors offer path to Europe’s rebound
Despite ongoing worries about reinfection and spikes in COVID-19, European countries are attempting to restart their tourism and hotel industries by forging reciprocal agreements with other European and international nations that they feel are at the same stage of tackling the virus, partnerships known as travel corridors or travel bubbles, writes Hotel News Now’s Terence Baker.
Developments happen weekly, if not daily, around these agreements. Examples of travel corridors and bubbles within Europe include agreements between the three Baltic nations—Estonia, Latvia and Lithuania—between Hungary and Slovenia and Denmark and all other European nations, although only those booking longer stays and who do not mind bypassing Copenhagen. U.S. citizens still are not allowed to enter Europe, with the exception of Belarus, Iceland and Portugal.
UK hoteliers welcome reopening, adjust to demand shifts
On 4 July, hotels in England reopened but amid social-distancing and hygiene regulations and the reduction in the safe, two-meter (6.56 feet) rule to one meter, a change that hoteliers said would allow them to at least run a viable business, writes HNN’s Terence Baker. Hotels in Northern Ireland opened on 3 July, while those in Wales and Scotland will open on 13 July and 15 July, respectively.
Demand is almost completely domestic at the moment, sources said. Robin Sheppard, president of Bespoke Hotels, said he has seen more than £500,000 ($625,604) in future bookings in the week after the government announced the 4 July reopening date. That sum involved almost 4,000 roomnights, and the majority of bookings were for two people for an average of two roomnights.
Hotels in France emerge from lockdown
Hoteliers in France have begun to reopen their properties, some 18,000 across the country, from mid-May, although some worst-affected areas such as Greater Paris were required to not begin welcoming guests until 2 June, writes HNN contributor Tamara Thiessen.
The tourism industry in France, the most-visited country in the world with approximately 90 million visitors a year, accounts for 8% of gross domestic product, €56 billion ($63 billion) in revenue and 2 million jobs. But hoteliers are aware that 50% of turnover is business-related bookings, namely conventions. Jean-Bernard Falco, founder and president of hotel-investment and asset-management firm Paris Inn Group, said “(France is) really lagging there compared to European competitors such as Germany.”
STR: Europe hotel performance for May 2020
Reflecting the continued impact of the COVID-19 pandemic, Europe’s hotel industry reported performance lows during May 2020, according to data from HNN’s parent company STR. Europe’s occupancy for the month declined 82.3% year over year to 13.3%, average daily rate declined 33.7% to €77.56 ($87.63) and revenue per available room declined 88.3% to €10.30 ($11.64).
STR analysts said absolute occupancy, ADR and RevPAR were up from April levels, but were the lowest for any May in Europe.
Whitbread betting on demand rebound as hotels reopen
With only about a third of its hotels open, Whitbread PLC’s performance has taken a hit in the first quarter due to the COVID-19 pandemic, but CEO Alison Brittain said she is starting to see a pickup, thanks to pent-up travel demand. The British hotel firm provided some trading numbers on 7 July, which showed year-over-year first-quarter 2020 revenue down approximately 75%, writes HNN’s Terence Baker.
On June 10, the company raised £1 billion ($1.25 billion) in new capital via a fully underwriting rights issue that issued one new share for shareholders’ every two. Analysts said Whitbread is well-placed to emerge relatively unscathed from COVID-19 but that with only approximately 15% of its hotels in tourism destinations (many are by road junctions), it needs to see corporate, wedding and group business return in some form.
Deals and developments
- Real-estate investment firms Henderson Park and Hines have purchased a 1,094-key portfolio of five hotels on the Greek island of Crete. The deals consist of the adjacent 218-room Hermes and 170-room Coral in Agios Nikolaos, the 208-room Santa Marina and 336-room Apollonia, both in capital Heraklion, and the 162-room Sitia Beach City Resort & Spa in Sitia.
- Renzo Rosso, the owner of the OTB Group, which consists of fashion brands such as Diesel, has bought the Hotel Ancora in Cortina d’Ampezzo, Italy, via his division Red Circle Investments, for approximately €20 million ($22.6 million). The 49-room ski resort in the Dolomite Mountains is the resort’s oldest and most-celebrated hotel, dating from 1826. The asset will reopen by the end of the year following a renovation.
- Radisson Hotel Group opened two hotels in Poland—the 219-room Radisson Blu Sopot and 104-room Radisson Szklarska Poreba—with owner Zdrojowa Invest & Hotels Group. The hotel firm now has a Polish portfolio of 14 assets.
- German hotel firm Ruby Group has announced its third London hotel, the 173-room Ruby Zoe, which in 2023 will join the Ruby Lucy, opened in London’s Waterloo district earlier this year, and Ruby Stella, to open in late 2022 in Clerkenwell. Frogmore Real Estate Partners Investment Managers is the developer.
- InterContinental Hotels Group has opened the 62-room Hotel Indigo Verona Grand Hotel Des Arts in Verona, Italy, a hotel formerly under the Byblos brand.
- Wyndham Hotels & Resorts opened the 133-room Ramada by Wyndham Valencia Almussafes on 1 July and will open the 61-room Ramada by Wyndham Madrid Tres Cantos in September. French real estate investment trust Covivio owns both.
Compiled by Terence Baker.