Coronavirus Impact on Hotel Industry: Key Insights

1. CORNONAVIRUS IMPACT: HOTELS
KEY INSIGHTS
Apr 2020
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2. INSIGHT#1
RevPAR recovery might take 5+ years
- It took an average of 5 years for RevPAR to get back to the prior peak in previous downturns (e.g. 2009 financial crisis); this crisis
might be deeper

3. INSIGHT#2
Branded hotels should outpace independent hotels
- Brands tend to outperform in downturns as they have superior distribution, selling, and awareness

4. INSIGHT#3
Economy & Midscale hotels will perform better
- Corporates (and others) trade down during downturns

5. INSIGHT#4
Domestic hotels should outperform international hotels
- Restrictive measures and uncertainty will keep travelers close to home

6. INSIGHT#5
Virtual meetings could leave lasting impact
- Shift to virtual meetings & other behavioural changes might permanently impact long term corporate demand

7. INSIGHT#6
Delayed bookings will impact yields
- Uncertainty discourages people to book far in advance; negative for yield management & pricing power

8. INSIGHT#7
Corporate travel will be more volatile than leisure
- Corporate travel bans might linger as companies limit SG&A spend

9. INSIGHT#8
Online disruptors will strengthen market position
- Asset light models will gain share; alternative accommodation supply will increase

10. INSIGHT#9
Increased risks for franchisor models
- Risks for royalty & other fees if owners struggle to pay or go bankrupt

11. INSIGHT#10
OTAs will be become more powerful
- Bargaining position strengthens in downturns, as hotels chase occupancy

12. ACKNOWLEDGEMENT, THANKS, TERMS & CONDITIONS
We are indebted and grateful to various companies and sources that have been cited in the document for their data and insights. We are especially grateful to pexels for the images used
in this report and MS Research for some insights. his report is not meant to be a substitute for professional advice, and must not be relied upon as such without explicit, written consent.
No representation or warranty (express or implied) is given as to the accuracy or completeness of information contained in this publication. REV Partners, or its employees and agents do
not accept or assume any liability, responsibility or duty of care for any consequences of anyone acting in reliance on the information contained in this publication or for any decision
based on it. If you would like to discuss the report, please contact the author.
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