As 2019 draws to a close, industry experts give their opinion on what the New Year holds - from further professionalization in the short-term rental segment to an increase in mixed-used hotel projects.
Simon Lehmann, Co-Founder and CEO of AJL Consulting LLC
The vacation rental industry will see professional property managers increase adoption of technology to automate operations. Building synergies around tech stacks and moving toward a focus on profitability through operations will be front and center.
There is clearly a transformative opportunity here. We’re seeing solutions for revenue/yield management, property automation, streamlined work-flows, check-in and other offerings that not only ease the process but positively impact the bottom line. Going hand-in-hand with this, we’ll see more vertical tech consolidation as big players engage in a race to expand their value proposition, maximize their customer base and become a one-stop-shop for managers.
Brian Quinn, VP, Head of Development - New Construction Brands at Choice Hotels International Inc
While the industry is seeing some revenue per available room (RevPAR) softening across the board, the aspiration to travel remains high. Boomers are living longer and traveling in retirement, and millennials are prioritizing spending on experiences, like travel, over material goods.
Developers know now is an excellent time to invest. Interest rates are holding while rising wages and low unemployment have contributed to favorable consumer confidence and spending worldwide. These factors are inspiring the industry to further personalize the guest experience and prioritize innovation.
Vanessa de Souza Lage, Co-Founder & CMO of Rentals United
Today, the [short-term rental] industry is made of owners (60%), small- to medium-sized managers (30%) and enterprise-level managers (10%), and each segment has completely different tech needs.
My prediction for 2020 is that we will have a clear distinction of software for every stage of the property management business journey that best suits each segment’s needs: simple guest communication for owners, property management systems with an ‘open API’ approach for small- to medium-sized managers and a highly flexible platform for enterprise-level managers. The future means no need to create your own tech; software houses will have you covered.
Mike DeFrino, CEO at Kimpton Hotels & Restaurants
[In 2020] there’s going to be no shortage of experiences and hotel brands for travelers to sample and engage with. We’re also seeing more integrated, mixed-used hotel projects - ones that feature recreational, residential and cultural spaces and businesses - essentially becoming the ‘town square.’ People are going to flock to hotels for everything from concerts to pop-ups to fantastic restaurant and bar experiences.
Mike Harrington, Owner of Carolina Retreats
Next year could be a catalyst year for the future of the vacation rental industry. With ... Google Travel for Vacation Rentals product becoming more mature, leadership changes at VRBO and the potential shift to a more all-inclusive travel planning OTA, and larger property management players colliding for market share, there is a lot to keep your eye on.
As a regional property management company, we will be watching closely the effect this has on the macro-vacation rental landscape - but we can’t get too caught up in things outside of our control. I believe this will be a net positive for the industry. However, those companies that do not adapt, or adapt too late, could be left behind in the next growth phase.
Atit Jariwala, Founder & CEO of Bridgeton Hospitality
In 2020 we should see a bit of an uptake in demand around the upcoming [US] election and higher investor confidence due to easing growth worries. Despite improving macro factors, the buildup in supply will outnumber demand and will force many hotel owners, including the larger chains, to further transform and think outside the box.
Larger franchises will need to have more unique offerings to cater to customers’ fast-changing preferences for unique experiences. More hotels will be plugging into real-time, local activities. Brands will be paying more attention to their well-being strategies as well, and we’ll see a lot of partnerships and programming with boutique fitness studios.
Blaise Montandon, General Manager, Four Seasons Resort The Nam Hai, Hoi An, Vietnam
Sustainability concerns will become as much of a consideration for guests as the location, amenities and level of service when choosing where to stay. This will play out in everything from increased demand for low-mile, plant-based meals to immersive experiences that promote connection and cultural preservation.
The travel industry will have to step up and become more accountable. The public is very aware and sees through ‘greenwashing’ attempts. As an industry, it’s our duty to take whatever steps we can to mitigate the damaging effects of tourism, and as knowledge of the climate catastrophe grows, it’s something that luxury guests will increasingly come to expect.
- Technology is expected to continue impacting short-term rentals, with automation enhancing operations
- It’s predicted there will be a clear distinction of software for every stage of the property management business journey that best suits each segment’s needs
- A buildup in hotel supply is forecast to outnumber demand, forcing many hotel owners to further transform and think outside the box
- The lines of hospitality will continue to blur as properties continue to extend their services and offerings and more mix-used hotel projects pop up