Rates peaked in 2019 with an average of $ 147 a night in Quebec, according to consulting firm Horwath HTL. The year 2020 was also to be one of affluence.
But COVID-19 has struck. Prices have plummeted to an average of $ 119. In Montreal, they fell 34%.
It will take until 2024 to recover the 2019 rates, considers senior partner Paolo Di Pietrantonio. From then on, hotels are expected to return to pre-pandemic occupancy rates.
In order to replenish the coffers, prices therefore risk increasing faster than inflation, especially since Montreal was experiencing a
retard and remained
economic compared to other major Canadian cities.
In the meantime, to say that supply supersedes demand becomes an understatement. Hoteliers feel like they are at a dead end. They will also have to deal with rising costs of raw materials and personnel in the coming years.
Permanent suspension of room service?
At present, room maintenance during the stay is suspended for sanitary reasons. It may well remain so for economic reasons, unless you pay extra.
Is this a trend that will stay or not?, wonders the director of the Hotel of the Institute of tourism and hospitality of Quebec, Marie-Claude McDuff.
Will this service become chargeable? Will this service mean that we will reduce our prices? I am really in this analysis.
According to her, hoteliers will have to study the profile of their clientele to determine the approach to adopt. Customers
financially more comfortable will likely require the service to continue to be included in the tariff, while those
more environmentally conscious or
more concerned about the health issue prefer the opposite.
Ms. McDuff points out that hotels were already giving bonus points to customers who refused service before the pandemic.
In an independent hotel, she points out, you don’t necessarily have bonus points, so you have to play on the price. My perception is that it will become a paid service.
Other suspended services
In the second largest hotel in Montreal with its 825 rooms, Center Sheraton General Manager Bertil Fabre, for his part, assures us that room service will be
always included to respect the
company standards, despite a last year
We have been living with loans for a year now, recognizes Bertil Fabre. It’s going to be complicated.
How then to regain financial health? He gives the catering service as an example:
When, where and when will we be able to reopen it? We generally make losses. So we will not be able to open services if we are still in losses, of course.
In the meantime, board games and craft materials occupy the restaurant tables. Far from martinis and grands crus.
Other avenues, although limited, are available to hoteliers to reduce costs. Automated kiosks in some hotels already make it possible to quickly identify and serve customers without human intervention. Minibars may become the norm again, as some guests want more in-room services to avoid going outside.
Should we expect a wave of shutdowns in the industry? Independent hoteliers will inevitably throw in the towel. Large banners will prefer to cease the activities of some of their establishments.
But impossible to know the extent of the phenomenon. Paolo Di Pietrantonio, from Horwath HTL, points out that
bankers are currently discreet because they do not want to recall loans and end up with a hotel park in their possession.
There is no danger at the moment, he says, but there are debt-to-equity ratios to meet and they are all in default.