NEW DELHI: The pandemic has severely impacted the domestic hotel and hospitality sector in the second quarter of 2020. Owing to the COVID-19-led restrictions on the opening of hotels, the hospitality sector reported a decline of 43.5 percent in Revenue Per Available Room (RevPAR) in the first half till June over the same period last year, found JLL’s Hotel Momentum India, a quarterly hospitality sector monitor.
The major impact of Covid-19 was faced by the industry during the April-June quarter.
Overall, in terms of inventory volume, brand signings declined by 83 per cent during the period. Room and F&B demand continue to remain minimal amidst lockdowns and partial openings, consultancy firm JLL said. All key 11 markets in India reported a decrease in RevPAR Performance in Q2 2020 over the same period last year. Mumbai continues to be the RevPAR leader in absolute terms, despite the decline of RevPAR by 81 percent in Q2 2020 compared. Goa saw the sharpest decline in RevPAR in Q2 2020, with a 93.9 percent drop compared to the same period last year.
Other cities such as Kolkata (88.9 per cent), Bengaluru (88.5 per cent), and Ahmedabad (85.5 per cent) also witnessed a sharp decline in performance.The report also added that international hoteliers dominated signings over domestic operators with the ratio of 63:37 in terms of inventory volume. “Whilst hotels in certain cities opened in early June, guests have not yet returned. We believe that demand in business cities will take time to recover and it will only happen when companies allow their employees to travel through their revised travel advisories.
Leisure demand may pick up around large cities wherein close friends and family groups may start traveling by road in the coming months,” the report added. Jaideep Dang, managing director, Hotels & Hospitality Group (India), JLL noted that investors are taking a sharper interest in exploring operational hotel opportunities and conversations are progressing, but site visits are still out of bounds.
ACTIVITY MAY RESUME IN THE MEDIUM TERM
JLL expects demand to resume in the medium term. The Covid-19 pandemic has brought the world to a standstill, with hospitality, travel and tourism sector being the most affected due to travel restrictions across the world.