Covid-19 lays its wrath on premium hotel, hotel industry staring at a down cycle; domestic leisure to offer some solace
Premium hotels went through a lull period post the global economic crisis when there was also oversupply amidst flailing demand. And hoteliers who were looking forward to capitalizing on the supply-demand arbitrage with robust ARR (average room rate) growth, were left with stress on their books and pending projects in the pipeline.There has been a reversal since then, albeit with few hiccups fiscal 2020 like general elections and a sluggish economy which impacted demand and the hotelindustrys recovery phase.
But, with Covid-19 becoming a pandemic and as nations worldwide went into lockdown mode due to rapidly rising caseload, hotel industry started feeling the heat. And the premium hotel industry has been among the first casualties due to restricted travel, with future prospects remaining bleak as major economies like the US and Europe witness slowdown and India joining the negative GDP bandwagon.
