Sunday, February 28, 2010

How will things get better (and when)?

To kick off our series of discussions, I'd like to begin with an article written by Sir David Michels, the former CEO of Hilton Group PLC and now a board member at both Jumeirah and Strategic Hotels and Resorts.

I've seen Sir David speak at industry gatherings on eight or nine occasions and I have always been impressed by his lucid overview of the issues facing the business, and his wry sense of humor as well.

Given his high-level perspective, I asked Sir David to tell Hotel Yearbook readers how he thought the economic recovery would unfold, and specifically how the recovery would take shape in the hotel industry, stage by stage.

His article is available online here.

Two things strike me about his stance. First, he believes there is pent-up demand for travel and we will start to see people travelling again in the 2nd quarter of 2010. Hotels will therefore be busier than in 2009 - but because rates won't have recovered yet, they won't be as profitable.

He also writes that "a large number" of hotels will change hands between about April and July.

Do you agree with these views?

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