2013 FORECAST
ONE STEP
DEVELOPMENT PIPELINES ARE MOSTLY BUSINESS AS USUAL FOR 2013 . THE NEXT 12 MONTHS SHOULD BE THE TIME FOR OPERATIONS TO SHINE .
By Oriana Lerner , contributing editor
With the clouds of recession slowly receding in the United States , the European debt crisis still shy of hitting critical mass and Asia growing a bit more slowly , hoteliers should have a reason to smile — or , at least , stop frowning — in 2013 .
Perhaps most importantly in the United States , supply growth of less than 1 % should continue to fuel RevPAR growth . “ We predict our North American hotels will be in the 5 % to 7 % RevPAR growth range ,” says Arne Sorenson , CEO , Marriott International . But that doesn ’ t mean hoteliers will have free rein in pushing pricing , as some industry analysts caution that post-recession travelers may remain in “ belt-tightening mode .”
In Asia , increasing domestic and intra-regional tourism is keeping the outlook bright . “ We might have some bumpy years , but consider that the Chinese MAC ( middle-class and affluent consumers ) were responsible for just over 20 % of Asian outbound expenditure in 2010 . By 2020 , that figure will be over 50 % — that ’ s 45 million people ,” says Bernold Schroeder , CEO , Jin Jiang International Hotel Management Co ., Shanghai . “ So , in the context of the big picture , 2013 and the subsequent years look quite good .”
But even with that kind of expansion , most hoteliers see the fever pitch of Asia ’ s upturn cooling somewhat . “ We anticipate room rates to carry on with their growth trend but at a more moderate pace ,” says Mohd Rafin , senior vice president , Park Hotel Group , Singapore .
The situation in the eurozone is top of mind for hoteliers both inside and out of the EU . There is no question business conditions could get ugly , but no one is panicking yet . However strained the economies of countries such as Portugal , Spain and Greece become , both developers and operators are combing the continent for opportunistic plays in gateways that have weathered far worse storms .
“ The only thing you can do is be prepared , have plans for different scenarios in your drawer and pull them out at exactly the right time ,” says Kurt Ritter , outgoing president and CEO , Rezidor Hotel Group , Brussels .
Hoteliers had better be carrying a lot of cash if they plan to bargain-hunt . Debt financing is likely to be “ difficult or impossible ” to get outside of key European cities , according to Russell Kett , chairman , HVS London .
Don ’ t expect to rely on MICE business , either . “ Companies continue to send travelers for individual business purposes , but strongly reduce seminars and incentive for their teams ,” says Pierre-Frédéric Roulot , president and CEO , Louvre Hotels Group , Paris .
22 HOTELS December 2012 www . hotelsmag . com