While this sector isn’t expected to get back on its feet overnight, restarting the operations of hotels is among the first steps toward the market’s recovery.
The hotel market has been badly hit by the COVID-19 pandemic with its operations limited since the lockdowns started in March.
While this sector isn’t expected to get back on its feet overnight, restarting the operations of hotels is among the first steps toward the market’s recovery. And the government’s recent move to soon allow staycations in general community quarantine (GQC) areas such as the National Capital Region (NCR) is a step in that direction.
“Mindful of the safety and sanitation protocols, [the] opening of the staycations market will be helpful as it would open more hotel facilities that require staff to go back to work,” Hotel Sales and Marketing Association president Christine Ibarreta said.
“More guests means more revenues, which will help sustain operations of hotels and resorts,” she added.
Only around 43 percent of hotels within Metro Manila CBDs remained operational during the enhanced and modified community quarantine period. This caused the overall occupancy level in the Metro to plunge to 25 percent during the period, data from Santos Knight Frank (SKF) showed.
“Those that continued to operate posted 30-percent to 95-percent occupancy levels, or around 58 percent on average,” SKF said, adding that most of the rooms were occupied by BPO employees and other essential workers.
This further dipped during the GCQ period with operating hotels’ registered occupancy levels at between 25 and 95 percent, averaging at 50 percent.
“Occupancy has dropped drastically over the last couple of months which slumped hotel revenues, and the global tourism market is still far from going back to pre-COVID-19 levels,” SKF associate director for investment & capital markets Kash Salvador said earlier.
Tajara Leisure and Hospitality Group president and CEO Cyndy Tan Jarabata emphasized the resiliency of hoteliers, noting that most hotels are raring to open their properties while ensuring compliance with the new procedures.
“There are definitely higher costs in operating now and lower profit margins given the limited occupational capacity and discounted rates,” Jarabata said.
“However, hotels just want to restart operations in order to give life to their properties and provide a livelihood to their staff members,” she added.
Staycation guidelines
While the Department of Tourism (DOT) has already issued guidelines for the health and safety protocols for the operation of hotels under the new normal, it has yet to come up with specific guidelines for the staycation market.
The DOT said earlier that staycations were targeted to commence by October 1. However, it has not announced if it has begun issuing Certificates of Authority to Operate for Staycations (CAOS), which is part of the guidelines it recently released.
Tourism Secretary Bernadette Romulo-Puyat said the DOT would soon issue a Memorandum Circular on Staycations under general quarantine based on comments and suggestions of the Inter-agency Task Force on Emerging Infectious Diseases (IATF-EID).
“The circular will have specific regulations on all aspects involved in this activity, ranging from the maximum allowable number of persons in a guest room to the use of ancillary services such as restaurants and recreational areas,” Puyat said.
A staycation shall involve a minimum overnight stay for leisure purposes in an accommodation enterprise accredited by the DOT.
“For instance, residents of the NCR can staycation within NCR subject to the requirements of the Local Government Unit (LGU),” Puyat said.
While the guidelines for staycations are yet to be released, Ibarreta said HSMA-member hotels are ready to cater to the market, emphasizing that sanitation protocols are already in place.
“It will be a more sanitized, clean and safe environment as we are aware that the virus is still there,” Ibaretta said when asked what staycationing guests can expect during their stay.
“We have to manage expectations, we can’t go back to pre-pandemic days,” she added.
Boosting promotions
As hotels are eager to welcome back guests to their properties, the HSMA has recently conducted an online sale to stimulate demand for travel when restrictions are eventually eased. HSMA’s 89-member hotels offered up to 70-percent discount in hotel rates in the September Online Sale (S.O.S) from Sept.15 to 30.
“For travelers, the S.O.S. is both a limited-time offer that can help them save on their next trip and a chance to help the Philippines tourism industry bounce back from COVID-19,” HSMA spokesperson Pearl Maclang said earlier.
The HSMA hopes the S.O.S event will stimulate demand for travel to help the tourism industry bounce back sooner rather than later.
“We believe that we will see the opening of domestic travel corridors by October, and more by December,” HSMA VP Benjie Martinez said.
“Come summer of 2021, we can expect the hospitality sector to be in a fairly better situation, as more people find ways to wake up in different parts of the Philippines,” he added.
Jarabata said it is actually good for staycationers to take advantage of the promotions now. She added that apart from the lower rates, there are also fewer guests staying, which will ensure physical distancing measures.
“Hotels are enticing the consumers with lowered rates and special packages with extended validity dates and no rebooking fees,” she said.
In addition, Jarabata said safety protocols are also part of the marketing campaign of hotels as they want consumers to be comfortable.
“I think we need to emphasize that the hotels have a culture of safety and hygiene procedures even prior to the pandemic and we have doubled, even tripled that standard now because we want our guests to feel safe,” Jarabata said.
Staycations not enough to speed up recovery
Despite the bright prospects brought by the staycation market to restart hotel operations, Colliers International Philippines research manager Joey Roi Bondoc said the move is unlikely to accelerate the recovery of the hotel market.
“This is unlikely to stoke the hotel market. We need more foreign tourists and they are unlikely to visit the Philippines due to travel restrictions,” Bondoc said.
“Domestic tourists are also skimping on travel-related expenses, with consumers focusing on essentials such as food and beverage and health services,” he added, noting that household spending on hotels and restaurants dropped 66 percent in the second quarter of the year.
Jarabata, on the other hand, emphasized the market within the permitted areas for staycations are eager to travel. She added that staycations are vital in restarting tourism.
“However, it will be a slow recovery as most regions where land trips are viable, are not yet open,” Jarabata said.
She emphasized that while the Philippines has a huge domestic market, a big component of recovery is allowing flights and ferries to openly operate, which will take some time as the country’s infection rates have not significantly lowered.
“Staycations in hotels are not enough, we need activities and services around to make these stays worth the travel,” she added.
The Philippine hotel and tourism sectors have a long way to go in terms of recovery but reopening doors to the staycation market will surely provide these industries a much needed boost.
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Article and Photo originally posted by The Philippine Star – Property Report PH last October 2, 2020 and written by Catherine Talavera.
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