CitizenM warns of ‘bloodbath’ as hospitality market struggles
The chief commercial officer of Dutch hotel group CitizenM has said the hotels sector faces a “bloodbath” as the coronavirus pandemic continues.
With many hotels struggling to attract visitors, CitizenM’s Lennert de Jong predicts some operators will be put out of business altogether.
“[There’s] a question mark over how [Covid-19] will shape the market, because the big analysts are not expecting demand to bounce back until 2022, 2023 or 2024,” he said. “That means in theory, there is a big bloodbath awaiting… If demand is only coming back four years from now, that is a difficult market. It’s to be seen how many survive.”
The chief commercial officer of Dutch hotel group CitizenM has said the hotels sector faces a “bloodbath” as the coronavirus pandemic continues.
With many hotels struggling to attract visitors, CitizenM’s Lennert de Jong predicts some operators will be put out of business altogether.
“[There’s] a question mark over how [Covid-19] will shape the market, because the big analysts are not expecting demand to bounce back until 2022, 2023 or 2024,” he said. “That means in theory, there is a big bloodbath awaiting… If demand is only coming back four years from now, that is a difficult market. It’s to be seen how many survive.”
De Jong said that large hotels reliant on the events industry will have “difficulties getting through this” as widespread bans on conferences remain in place. Smaller operators may have to “close their doors”, he added.
While experts have been saying that “heavy consolidation” will take place, de Jong questioned whether this will come to fruition. “I don’t know who has money to buy their competitors at the moment,” he said.
He said the hotels-as-offices trend, which the company has been tapping into since its inception, has been accelerated by the pandemic, as occupiers realise “we can work anywhere without a problem”.
Covid-19 has had a “big impact” on the cities CitizenM operates in, but de Jong noticed a slow return in business travellers coming back to cities in Amsterdam, some secondary cities in Europe such as Zurich and Geneva, and some areas in France and the US.
De Jong added: “We want to walk away from just selling a room on online travel agencies for the night. That will be a red ocean for the next couple of years.”
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