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A challenging year ahead for hotels
Deloitte & Touche last week published the results of their
Hotel Survey for October to December 2000 together with flash
results for the first few months of 2001 at a presentation to
members of the Malta Hotels and Restaurants Association.
Although the figures for last year were relatively stable, there
is still concern in the industry that the picture for this year
is not all that rosy. The survey shows that although tourist
arrivals for 2000 were unchanged on 1999, the combination of
a shorter stay and an increased bed-stock meant lower room occupancy
was reported in each hotel category for the year. It was only
an improved December (compared to 1999 which had the impact
of the Millennium scare) that overall occupancy results were
only two to three percentage points lower for the year. In 2001
the restructuring of the German market is expected to have a
negative impact on certain hotels, Deloitte & Touche said.
Flash occupancy results for January to March 2001 suggests that
while five-star hotels have had a much improved January and
March, four-star hotels are likely to report a slightly lower
occupancy level than for the same period last year. For once
however, three-star hotels are expected to report more up-beat
results for January and February than their four-star colleagues.
The figures for arrival show that in the last quarter of 2000
German arrivals fell by nearly 20 per cent, offsetting gains
made elsewhere. UK arrivals reported an 8.5 per cent increase
for the same period, registering a month-on-month gain in the
last five out of six months. This seems to be the beginning
of a trend for 2001 with similar results in January and February.
There is not doubt that such a trend will be more than welcomed
by the local industry, and it is a pity that the German market
will be cutting down so heavily. Otherwise, the local industry
would have a much better outlook for 2001.
The challenges for this year were nicely summed up by Nick Captur,
Business Advisory Partner at Deloitte & Touche: “It
would appear that 2001 will be a challenging year for the industry,
as hoteliers therefore seek increases in the UK and other markets
to compensate for the restructuring of the German market. At
the same time there is also a changing market mix so that five-star
hotels which appeal to conference and incentive market segments
are less vulnerable than properties aimed solely at holidaymakers
and tour operator business.”
The Malta Tourism Authority and The Malta Hotels and Restaurant
Association are doing sterling work in re-creating markets that
were either lost or never tapped. It is encouraging also to
see that the re-classification exercise has had a very positive
effect on hoteliers. However, there is so much that can be done
for very little money that when one thinks about it, we should,
as a country, be ashamed of ourselves.
While most hotels ensure that the immediate surroundings are
spotlessly clean, outside their perimeter the roads are dug
up, piles of rubbish can be seen at regular intervals and cars
are parked on the pavement. It does not take a million liri
to clean up a road or to send a warden down to slap a fine on
the miscreant. Yet, somehow, we fail to tackle the basic issues
that any tourist looks for: a clean and safe environment.
The survey also shows that average room rates have increased.
Room rates for 2000 as a whole improved significantly in the
five-star sector. For 2000 five-star hotels reported an AARR
(average achieved room rate) of Lm34.47 with 66 per cent occupancy
compared to Lm29.75 in 1999 with 68 per cent occupancy.
This figure could easily go up by 10 or 15 per cent if visitors
are given that little extra. Being able to walk from say, St
George’s Bay to Paceville, should be pleasant, and not
a nightmare: having to look out for oncoming cars or potholes.
Small details that do not cost a lot of money. The government
stands to gain more in doing up these areas than by leaving
them in a shambles.
Our little island has so much to offer to visitors that they
will be more than willing to pay more for a better quality service.
Take public transport. How many times have we heard that changes
are going to take place and buses will be changed? Too many
to remember. Instead of changing the old buses, the government
should encourage the owners to get their vehicles in good condition
and use them as a unique attraction of our local transport system.
In turn, spend the money on educating the drivers and give them
further incentives to do better. And even better, do not turn
it into a political issue. There are enough of those already
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