Hotel brands have a (good) challenge with money

Skift grip

Today’s edition of Skift’s daily podcast examines what hotel brands are doing with record sums of money, luxury rental investors in Kenya and the blues of remote work management.

Rashaad Jordan

Hello from Skift. We are Wednesday, August 24 in New York. Here’s what you need to know about the travel industry today.

listen now

🎧 Subscribe

Apple Podcasts | Spotify | Covered | Google Podcasts

Episode Notes

The pandemic has accelerated notable developments in travel, such as the rise of remote working and the short-term rental market. But contributor Harriet Akinyi reports that it has also pushed entrepreneurs to invest in luxury homes in Kenya rather than hotels.

In addition to becoming an increasingly popular investment for consumers looking for more spacious properties, Akinyi notes that luxury homes are attracting travelers who find them more comfortable than hotel rooms. A tour operator executive said some customers are choosing luxury hotels over what he considers outdated hotels, resulting in low bookings for those hotels.

But Akinyi writes that Kenyan hotels also cater to luxury homes. Hotel brands, such as Hemingways Collection, are investing in luxury houses. Such moves help to secure revenue for hotels even during low season, ensuring that staff can still keep their jobs.

Next, while hybrid working is here to stay, companies are struggling to manage coworking spaces for remote employees. A new report reveals that most companies are failing to take control of flexible office spaces, reports Matthew Parsons, business travel editor.

According to a new report from the Global Business Travel Association, only 17% of travel managers say coworking spaces for staff members are fully managed. Additionally, 44% of travel managers admitted that they don’t know how their company procures coworking spaces.

But the report says travel managers aren’t to blame for the difficulty in managing coworking spaces, as Parsons writes they have bigger problems on their plate. About 80% of travel managers said they spent more time resolving traveler issues, according to an association survey of 223 such professionals.

Finally, global hotel groups are being inundated with near-record sums of money, but this is forcing tough decisions on them. Hospitality editor Sean O’Neill reports that these hospitality giants have dozens of options to deploy their massive cash stacks.

Seven of the world’s largest hotel companies had about $7.3 billion in cash and short-term investments as of June, according to a recent set of financial filings. O’Neill writes that these companies are taking different approaches to managing their cash piles, with most reporting plans to reduce them in one way or another.

O’Neill cites Hyatt and Wyndham as two companies considering using their cash to invest in properties. Meanwhile, Marriott said it expects to return more than $2.2 billion to shareholders this year.

Comments are closed.