(TAN): American hospitality giant Marriott International expects worldwide revenue per available room (RevPAR) of its hotels to drop around 23% in the first quarter of 2020, with approximately 25% of its 7,300-plus properties temporarily shut owing to the pandemic.
Marriott said its global RevPAR went down 60% for March – with 57% decline in North America, 74% in Asia Pacific, 71% in Europe, 57% in the Caribbean and Latin America, and 56% in the Middle East and Africa.
Of the 74% dip in Asia Pacific, Greater China saw a 83% fall while the rest of Asia experienced a 68% drop in RevPAR in March. However, in Greater China, where travel restrictions and quarantine measures have eased, the company saw “steadily improving RevPAR trends through March and into April”. Occupancy went up 20% in the first week of April, while number of closed hotels in the region diminished from 90 in mid-February to 20 at the present, Marriott said.
“While there have been early signs of improving demand trends in Greater China, the negative trends in the rest of the world have not yet stabilized,” the company said.
In North America and Europe, occupancy levels are currently around or below 10%. Marriott has temporarily closed over 870 or 16% of its hotels in North America, and more closures could follow. In Europe, the company has temporarily shut down 79% of its hotels, that translates to around 500 properties.
In the Middle East and Africa region, Marriott has suspended operations at nearly 150 hotels, or 54% of its properties in the market. In the Caribbean and Latin America, 69% or around 200 hotels have been temporarily closed by the company.
Marriott said the near-term outlook is tough; it “anticipates further hotel closures and erosion in RevPAR performance and does not expect to see a material improvement” until the spread of the coronavirus is curbed, and restrictions are lifted.
