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Hotels dodge 'even more of a disaster' over coronavirus

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamian resort industry has “escaped even more of a disaster” by getting through much of the peak winter season before the coronavirus fall-out took full effect, a senior hotelier says.

Robert Sands, pictured, Baha Mar’s senior vice-president of government and external affairs, told Tribune Business that the hotel sector was hoping to “get through March” before the worst effects of the travel cancellations and postponements took effect.

While forward bookings “have slowed, and continue to slow”, Mr Sands said there were also signs that Easter holiday business volumes “may hold but not at the levels anticipated”. He added, though, that it was “a different ball game” beyond Easter with tremendous industry uncertainty over the outlook as the industry heads into the slower summer months.

The Baha Mar executive also said “the jury is still out” on whether the Covid-19 pandemic will have the same impact on The Bahamas’ largest private sector industry as the likes of the September 11 terror attacks and the 2008-2009 recession.

He indicated that comparisons between these events were unfair at present, especially since all flights from the US were grounded for 14 days following the former and “we’re not in that position yet”. Mr Sands said that while no resort was currently contemplating lay-offs, the sector was focused on “maximising labour values and economies of scale” should the situation persists.

That is likely a reference to reduced working hours and weeks for sector employees, and he told Tribune Business: “We’re in uncharted territory. Fortunately, I think the hotels have gone through January and February, and March to a large degree, which is holding with some attrition.

“That has been a little bit of the light for the industry. If we can get through March, and February and March are the most critical months of the year, although many of the properties may not make projections....... Had this happened at the height of the winter season, and we not be able to experience some of the occupancies for February and March, it would be even more of a disaster.

“Beyond March it’s a different ball game but the substantive part of the winter season is still preserved. It is beyond that period, and into the period when it is traditionally slow. We don’t know what the final outcome will be, but the slowing of bookings indicates the business levels anticipated will not be realised. I think Easter may hold, though not at the levels anticipated, but it will be after that which is in question.”

Describing The Bahamas a a destination where there is traditionally a short booking lead-time, Mr Sands said the industry was monitoring booking pace rather than cancellations to gain a better understanding of future business levels.

“The real monitoring agent for determining the level of business going forward is the booking pace, which has slowed and continues to slow,” he told Tribune Business. “We’re certainly preparing ourselves for what is to come.

“The tourism industry in The Bahamas and worldwide is very resilient. This is certainly temporary, but we don’t know how long temporary is. It will relent, but during the period of impact it will inflict a certain level of pain.”

Asked how the Covid-19 crisis compares to previous external shocks that have hit the tourism industry, such as September 11 and the 2008-2009 recession, Mr Sands replied: “I think the jury is still out. You would recall from 9/11 that there was no air travel at all for 14 days. We’re not totally in that position as yet.

“All flights were grounded for an extended period of time, and we’re not in that position. It would not be a fair comparison to say we’re in that state at this time.”

As for how the hotel industry will likely respond to preserve financial sustainability, Mr Sands added: “I don’t think anybody is looking at lay-offs, but certainly maximising labour value and economies of scale if it gets any worse.

“It’s almost like hurricane season, and plans you put in place to deal with major hurricanes apply to this situation as well. Dorian and the coronavirus have certainly set us back. The country was gaining strength. It has delayed recovery, as we had rebounded fairly quickly after Dorian only be hit with this worldwide pandemic.”

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