Edinburgh, Glasgow and Manchester hotels ‘well-positioned' for recovery after coronavirus

27 April 2020 by
Edinburgh, Glasgow and Manchester hotels ‘well-positioned' for recovery after coronavirus

Edinburgh, Glasgow and Manchester are among the European cities well-positioned for hotel performance recovery, based on analysis by CBRE.

According to the real estate adviser, markets with more leisure demand and a lower reliance on international travel (particularly long-haul) and meetings, incentives, conferences and exhibitions (MICE) are best-positioned for a more rapid recovery.

CBRE said domestic travel will be the first to see a return of activity. The UK is among the countries with the highest share of domestic tourism spend, which makes it well-positioned for a more immediate recovery, notwithstanding the economic effect of Covid-19 and consumer perception of risk.

International travel demand will take longer to return, with short-haul recovering before long-haul. CBRE's findings suggest that as a result of this, accommodation providers in gateway cities and airport locations will be most exposed to the limited demand.

Leisure travel is likely to see an immediate surge in demand, particularly staycations. Countryside and rural hotels across Europe are expected to benefit from this trend first, as travellers will initially seek to avoid densely populated locations.

While corporate travel will return as economic activity resumes, CBRE expects it to be limited and to remain below ‘normal' levels for the short-to-medium term, as companies will look to recover their financial position before increasing spend on travel.

According to the report, international MICE is likely to be the most-affected segment and will take the longest to recover.

Joe Stather, associate director of hotels at CBRE, said: "Previous demand shocks in the hotel market show us that not all customer segments are impacted to the same degree, or indeed follow the same trajectory in terms of recovery. We anticipate that markets across Europe that have previously benefited from strong domestic leisure demand are well-positioned to lead the recovery cycle."

Photo: Shutterstock

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