Industry Update
External Article 4 September 2020

Why new hotels are opening amid the pandemic

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To say that Covid-19 has hurt the hotel industry, along with travel as a whole, is something of an understatement.According to Hotel News Now, the news division of hotel research company STR, the sector has seen a loss of 5 million jobs since February in the United States alone. And Zachary Sears, a senior economist at Tourism Economics, part of research firm Oxford Economics, says that hotel occupancy in some instances is down 95% versus a year ago."Properties have been forced to close permanently because of the financial loss they've taken," he says.In fact, the American Lodging and Hotel Industry released a report on August 31 that indicates 65% of hotels remain at or below 50% occupancy. The same report states that consumer travel is at an all-time low and that only 38% of Americans say they are likely to take a leisure vacation by the end of the year. In normal circumstances, 70% of Americans take a vacation in any given year.Despite the bleak scenario and the continuing pandemic, there is a bright spot: from Europe and the United States to Africa, Asia and Australia, a spate of new hotels from bigger brands as well as smaller owners are set to open this fall and into the winter."The next several months are a busy time for hotel openings," says Leo Sorcher, the founder of luxury travel company Inhabit the World. "They show a light at the end of this long tunnel."In the United States, The Inn at the Mission San Juan Capistrano in California will open in September in the heart of downtown near the city's famous 19th century church ruins. Also in September, the artists enclave and celebrity hideaway of New Hope, Pennsylvania, will see the opening of luxury boutique property River House at Odette's. Come November, Palm Beach will have White Elephant, the second location of Nantucket's well-known eponymous resort.

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