The tourism sector is facing challenging times in the face of the COVID-19 pandemic as a result of strict travel restrictions applied across Australia and New Zealand to help contain the virus. While the impact of the lockdown measures has been somewhat tempered by the utilisation of existing hotels and motels as quarantine facilities for inbound travellers and as healthcare worker accommodation, there are still plentiful opportunities – both short and long term – which can be explored by hotel owners, developers, and brands to help better position themselves to weather the storm ahead.
Essential and Practical Support
Continuing to help alleviate stress on the healthcare sector is of critical importance, with hotels being well placed for re-adaption opportunities if we see a surge in critical care cases in hospitals resulting in an overflow of non-acute patients needing alternative accommodation. A practical review and resulting adjustments would need to be made to existing facilities to mitigate airborne pathogens (upgrading HVAC systems, HEPA filtration and integrating UV light) and ensure the continuance of newly installed vital medical equipment (backup power and emergency generators) in order to support a safe and healthy environment for patients to be treated.
Brand Reputation – Risk Versus Reward
While providing immediate support is important from both a social responsibility and financial perspective, hotels would be remiss not to consider the impacts – both positive and negative – that being associated with the pandemic may have on long-term brand perception. The Psychology of Places indicates that future holidaymakers and business travellers may be hesitant to book accommodation which was used for quarantine purposes during the pandemic. Similarly, we are yet to understand the long-term impact that negative media from guests ‘trapped’ in their room during the 14-day mandatory quarantine period will have on hotel properties bottom line post-pandemic. A post-quarantine medical grade clean might not be enough to wash bad press from the minds of future guests, with more tangible changes – such as a refurbishment – expected to gain popularity.
What’s Around the Corner?
With a promising drop in new COVID-19 cases across much of Australia and New Zealand the hotel sector is looking ahead to what the coming months will hold for the future of new and existing developments. Tight international travel restrictions are likely to remain for many months, and once lifted, international airline prices may increase due to less seating capacity resulting from spatial distancing requirements; travel insurance costs and conditions may further restrict the number of people able to fly.
Due to international travel constraints, local tourism will be the first market segment to rebound, with an expected surge in local and interstate leisure and business travel resulting from pent up demand arising from both necessity and the desire for respite from isolation zones. There will be an increased demand for mixed levels of accommodation, ranging from affordable family-focused resorts, to inner-city hotels for corporate travellers, to high-end leisure properties, and everything in between. Domestic travel may also be further propelled by lower fuel costs.
Demand for refurbishment will see renewed interest from operators seeking to attract repeat patronage from local tourists. Similarly, refurbishing properties which had previously been utilised for quarantine purposes may see increased popularity to help mitigate the potential reputational risks previously discussed.
Small Changes with Long Term Impact
Hotels are fortuitous in that their design doesn’t need to be significantly altered in order to better accommodate for the immediate response to disasters such as the COVID-19 pandemic; they are already equipped with a multitude of essential facilities including commercial kitchens, centrally linked telecommunications in each room, established cleaning regimes and staff, single point of entry, large open plan rooms that can be set up as emergency admin facilities, and established waste removal. Similarly, online ordering and delivery integration allow buoyancy retention of existing food and beverage components whilst also providing a vital service for hotel guests and staff.
Small changes to reduce physical touchpoints, bringing health and wellness to the forefront, have a big impact on consumers perceived and actual safety in these spaces going forward, with opportunities to utilise smartphone technology for lifts, rooms, lighting, TV, blinds and air conditioning. Simple adjustments such as sensor tapware and fixtures also do their part in helping reduce opportunities for virus transmission.
‘Digital Passport’ apps have also been used in countries such as China to help identify users health status before granting them entry into buildings; we may yet see similar technology implemented across Australia and New Zealand which could then be utilised by hotel operators during the check-in process.
Enduring Response
Logistics are key to the operation of a hotel; in order to ensure adaptability for future disasters floor plates may need to be reviewed to allow for secure areas, sub-zoning to avoid incidental interactions and facilitate agile back-of-house flow. Material specification will be more important than ever to ensure adequate sanitization can be achieved; however, the availability of materials will be impacted by restrictions on global trade and logistics resulting in a greater reliance on local suppliers.
Heavily reliant on artificial ventilation, even if HEPA filtration systems are introduced, existing hotels may need to address their façades to allow for natural ventilation– introducing windows and/or external door openings onto balconies or wintergardens to allow for natural ventilation will provide guests with a much-needed respite from their main room.
Changes may also need to be reviewed in new hotel design and operations to ensure that the health risks to hotel staff are minimised; creating better provision of staff areas and reviewing the practicalities of staff exposure, for instance, providing staff with in-house temporary accommodation on rotation will be essential if a similar future crisis occurs.
The Evolving Tourist
Once domestic and international travel restrictions are relaxed, brands must be agile to adapt to the changing conditions that unfurl from this experience. We may see some travellers seeking a reversion to tradition, comfort and maintenance of distance; while others may hanker for opportunities to connect, engage and socialise.
While many hotels have already implemented initiatives which go beyond the traditional accommodation model, we may see this taken further with an increase in health and wellness facilities driven by guests elevated awareness of the importance of physical and mental wellbeing. A rise in facilities and services such as cooking classes, health pools and virtual yoga sessions will accommodate the wellness traveller. Hotels with an emphasis on sustainability may also increase in demand due to their ‘less is more approach’, which sits harmoniously alongside a wellness strategy. An increase in AI and big data collection can help hotels adapt these wellness strategies to their guests’ individual needs.
An Alternative Path
Whether the government will provide subsidies for brands and operators willing to refurbish or develop new accommodation to meet the changing hotel accommodation needs of the community is yet to be seen. If the current portfolio of hotels is no longer as profitable, we may see some properties being diversified or repurposed entirely.
Converting sections of the hotel into apartments is one avenue that owners may explore to help create a diversified and sustainable income within their portfolio. Alternatively, repurposing hotel accommodation into affordable housing developments is another avenue owners may explore. With the ability to alter the room design and the existing facilities adapting to community-centric facilities, this model works well as an alternative strategy as many hotels are connected to community precincts and transportation infrastructure.
Maintaining a Positive Outlook
While there is no question that the hotel and hospitality sector has been one of the fastest and hardest hit as a result of the COVID-19 pandemic, the immediate response of accommodation providers has proven that their business is of critical importance to the short and long term future of our communities. Whether they are providing quarantine facilities, relief/emergency worker accommodation or providing temporary workplaces following a natural disaster, there are ample opportunities for hotels and motels to reimagine their service offering above and beyond the standard business and leisure travel model to better position their properties now and into the future. We also must remember that despite the current challenges, history has proven that the tourism sector is resilient and has the ability to bounce back stronger than ever.
If you would like to speak to our team about how we can support your hotel or hospitality business through innovative and thoughtful design, please contact hello@buchangroup.com
