Industry Update
Press Release17 September 2020

Can Hotels Cement Their Place In The New Remote Working Culture?

With remote working now mainstream, hotels are increasingly offering empty rooms as individual office space for the day

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Jones Lang LaSalle

Hotels have long been hives of remote working, from business travellers sending emails after meetings nearby to more recently, coworking spaces in communal areas attracting a new generation of digital nomads.

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Now, with fewer guests staying overnight, some hotel groups are homing in on remote workers by offering bedrooms as makeshift daytime offices.

The work-from-hotel model, driven by major operators such as Accor, targets local workers seeking out a better balance between work and home life - or simply a change of scenery after months of working from home.

In the Netherlands, a range of hotel rooms are available through one website, "For The Home Workers", from Holiday Inn Express to Novotel and DoubleTree by Hilton. In Amsterdam, rates range from €25 to €85 per day and around €300 per month.

In the UK, some 250 hotels are taking part across Accor's brands, including Novotel, Ibis and Mercure, while in the U.S, Hotel Figueroa in Los Angeles has joined the Work Perks programme, offering high-speed WiFi, unlimited printing and free parking.

"Across all real estate sectors, more cross-sector collaboration is needed and is now emerging," says Jessica Jahns, Head of Hotels & Hospitality Research, EMEA. "That's particularly true for the hospitality industry as it seeks new ways of operating after a long period of closure and low occupancy. It's about turning redundant areas into much-needed revenue."

It's also about more than just the room rate alone. "It opens up new possibilities for the hospitality sector, offering a range of services, from breakfasts to coffee, lunch or even dinner," says Jahns. "Some hotels are throwing in other freebies such as access to leisure facilities although of course that depends on local COVID-19 restrictions."

Global hotel chain TFE, which owns brands including Adina and Vibe, offers rooms in Sydney, for example, from AU$75 (€46) from 9am to 5pm including full use of hotel facilities including restaurants, pools and gyms.

Meeting short-term needs

For local workers, the idea of ordering room service to arrive as a video call finishes may sound like an appealing short-term solution. But can it become part of hotels' offerings in the longer-term?

"There's a strong probability that day-usage may dwindle as offices gradually welcome back greater numbers of employees," says Jahns.

"It will very much depend on demand, with much of that coming right now, for example, from flat sharers who find working from their home a challenge, as well as those on a freelance or contract basis."

The appeal of the work-from-hotel model is strongest in cities, Jahns says - especially with the shift back to living in high rise apartments in urban centres over the past decade.

"Large cities where people face pressures such as smaller living spaces or busy commutes are where hotels can most likely step in," she adds.

Managing day guests

There are challenges for hotel operators to cater for their new day guests, from adapting staff shift patterns to managing a flurry of check-ins while also providing food and beverage services and enhanced cleaning to meet the standards expected in the COVID era.

"Automation within hotels, particularly at check-in, has already somewhat smoothed the way to a minimal contact approach," says Jahns. "However, room service throughout the day requires a minimum level of interaction and personal service - something which has been lacking during COVID-19."

Hotels will equally need to reassess their capacity to offer rooms as offices when demand from travellers picks up again - even if this could be some way off amid rising concerns over second waves of infections.

In the meantime, there are opportunities for hotels to build brand loyalty, and potentially convert day guests into longer-term users of their coworking facilities when they re-open. Indeed, hotel groups such as the Marriott and Accor were building in their own coworking spaces well before COVID-19.

"We've seen more hotel clients looking to optimise the space they already have, in terms of front-of-house and business centre offerings that can be adapted to suit flexible working," says Oliver Hoath, Senior Project Manager - Tétris EMEA Hotels. "They're a good fit because cost of conversion is generally low as the space often already caters to conferencing or face-to-face meetings."

He expects more hotels to follow suit in the coming years as they increasingly look to alternative revenues streams and companies consider a wider range of locally-based spaces.

Indeed, while remote working won't impact hotels in the same way as the office, it could play a greater role in their future design and business plans.

"Hotels are well-placed to adapt to the growing remote working trend, which has been vastly accelerated by COVID," agrees Jahns. "The boundaries between the spaces we use to live and work are getting evermore blurred and in the future, we'll see hotels looking to increase their appeal among local workers and digital nomads."

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About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $18.0 billion, operations in over 80 countries and a global workforce of more than 93,000 as of December 31, 2019. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.

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