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Updated CDC Guidance Contributes to Increased Traveler Confidence

by | Apr 22, 2021 | Hotel Industry News

Hotel Booking Window Remains Short, Could Lengthen This Summer

Passengers wearing protective masks check in and drop off luggage at the Delta Air Lines ticket counter at Hartsfield-Jackson Atlanta International Airport in Atlanta. (Bloomberg/Getty Images)

On the heels of updated guidance around travel for fully vaccinated Americans, hoteliers are noticing improving momentum with bookings pace into the summer and fall months.

The Centers for Disease Control and Prevention released updated guidance, said this month that fully vaccinated people can travel within the U.S. without the need of COVID-19 testing or self-quarantining post-travel. People are considered fully vaccinated two weeks after their recommended second dose of vaccine.

Brian Berry, executive vice president of commercial strategy at Pyramid Hotel Group, said in an email interview the hotel bookings pace continues to accelerate this year.

“While we aren’t attributing a specific spike in bookings activity that coincides with the April 2 CDC guidance, we believe the updated guidance, coupled with increased consumer confidence and a growing population of vaccinated Americans, is contributing to accelerating demand growth,” he said.

Prior to the CDC’s updated guidance, people understandably felt some uncertainty around the safety of travel and other appropriate activities once vaccinated, and Berry said the guidance “has gone a long way in providing confidence for travelers.”

This also gives a hopeful glimpse into what a post-pandemic world might look like, he said.

Cory Chambers, senior vice president and chief revenue officer at Hospitality Ventures Management Group, said in an email interview that the updated CDC guidance may influence some travelers but it’s difficult to correlate it to increased demand.

He said bookings within the company’s hotel portfolio began to increase this March.

“We are seeing weekend occupancies at or above 2019 in many markets; weekdays are still lagging tremendously,” he said.

Vickie Callahan, senior vice president of revenue generation for Peachtree Hospitality Management, said in an email interview that her company’s hotels are experiencing an increase in bookings, with April pacing ahead of March.

“The CDC green light and state mandates [that have] lifted have clearly shifted travelers’ mindsets that it is now safer to take that trip,” she said.

Peachtree Hospitality Management’s hotels are reporting more robust demand for Friday and Saturday nights, with occupancies in the range of 70% to 80%. Midweek occupancy is still soft, she said, but is expected to improve as the summer months approach.

Theresa Hajko, regional director of revenue management at Spire Hospitality, said the updated guidance is partially helping to boost bookings, but demand is also attributable to comfort levels around travel and consumers’ financial health due to stimulus funds.

“A lot of leisure travel right now on the weekends is driven by the stimulus check,” she said. “We can pinpoint when they’re going out and which weekend we’ll start to get busy.”

Booking Window

Berry said despite new guidance, most of the bookings at his company’s hotels are still occurring within 30 days of the stay. However, there’s evidence that the booking window is lengthening.

Online search and website activity through the summer months is reflective of the growing population of vaccinated and soon-to-be vaccinated individuals, he said. Pyramid is also booking a meaningful number of reservations into the fall months.

Callahan added that at Peachtree’s hotels, there’s been less discounting of rates for those stays booked in a short window.

Chambers said 80% of bookings at HVMG’s hotels are coming within one week of arrival.

Hajko said bookings at Spire’s hotels are still week-of, and in some cases day-of. Improvement in future bookings is also more meaningful in specific markets, such as Nashville, where bars and restaurants are able to open to larger capacities and for longer hours.

“It is ramping up, but nowhere near where it was,” she said.

Segments, Markets Driving Demand

Callahan said the leisure traveler will drive hotel demand for the foreseeable future. While business transient demand has improved within Peachtree’s portfolio, she said she doesn’t expect a dramatic improvement until more people are back in offices.

Initially, and potentially from now on, she said most businesses will adopt a hybrid model with a combination of in-office and at-home working.

“That can pose an opportunity for hotels that have short-term meeting spaces for groups to get together. The biggest challenge — and we believe this will take the longest to recover — will be for large conventions to return,” she said.

Berry said it is reasonable to expect the confidence vaccinated people now have for leisure travel will carry over to other segments. The path to recovery in the business and group segments will take longer than leisure, he said, but Pyramid is confident there are similar levels of pent-up demand for travel in those segments.

He said his company’s corporate clients are putting their associates’ safety first.

“The CDC’s announcement, coupled with the scientific evidence that contributed to their guidance, most certainly will provide businesses the foundation for a clearer policy pertaining to their vaccinated travelers,” he said.

Chambers said corporate and group demand is still substantially below all other segments, and HVMG has not noticed many businesses reevaluating their travel restrictions.

“CDC guidance may help those segments loosen corporate travel restrictions, but most corporate accounts are indicating that they are still travel-restricted at least through [the third quarter],” he said.

Hajko said some conventions could pick up in-person attendance at the tail end of 2021 and into 2022. She said the number of businesses booking rooms at Spire’s hotels each week has doubled in recent weeks.

She said she’s still confident in the road traveler but people are “clearly not afraid to travel by plane” now.

Callahan said Peachtree’s destination markets and coastal properties are “surging with visitors, particularly with spring break on the East Coast,” she said.

“We attribute this to pent-up demand for travel, wanting to get out of the house for adventure, stimulus money and youth sporting events,” she said.

Berry said hotels and resorts in the Sun Belt have benefited from record levels of leisure demand as customers have sought warm weather destinations, reduced regulations and outdoor activities.

Recently, markets beyond just Florida, Arizona and Texas — including Midwest and East Coast cities — are experiencing growing hotel demand, he said.

Article by: By Dana Miller View full article here

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