Hilton Sees Uptick in Corporate Transient and Meeting Demand
By: Business Travel News (excerpt)
Hilton Worldwide has seen a pick-up in business travel in the third quarter, as well as some group business bookings ‘in the year, for the year, and not in insignificant amounts,’ said the company’s president and CEO Christopher Nassetta on a Wednesday morning earnings call.
Hilton saw steady increases in demand over the summer, led by leisure. Those trends slowed after Labor Day; however, that was “offset by the slight uptick of corporate transient,” Nassetta said. “It’s not the traditional [transient] customers … it’s smaller business, sales forces, frontline folks responding to the crisis.”
He added that the group bookings also were not what the company typically sees for that segment. “It’s smaller corporate meetings in lieu of being in the office, it’s sports groups, and it’s groups related to the recovery and crisis efforts,” he said.
The more traditional groups are booking and rebooking very little in the first quarter of 2021 and “some” in the second quarter, with “the bulk picking up good velocity in the second half of next year and beyond,” Nassetta noted.
Overall, he said the company saw improvement during the third quarter over the second quarter, and that 97 percent of the systemwide properties were now open, with a ‘vast majority’ operating at breakeven occupancy levels or better.
“We’re encouraged by the progress made over the last several months,” Nassetta said. “Travel demand is gradually picking up around the world, and we’ve welcomed back most of our corporate team members last month.” He added that Hilton is in the first phase of reopening its corporate offices, development deals have picked up, and travelers are feeling more comfortable.
Still, while there was the loosening of some travel restrictions during the summer, Covid-19 cases have picked up around the world, adding uncertainty to the fourth quarter. “There is a risk with the virus, it could go backwards,” Nassetta said. “Our best sense at the moment is people figuring out how to manage their own risk profile. We have a lot of data and information, and so long as countries aren’t locking them down, there’s some level of mobility that will likely allow us to maintain this level of operations we’ve been seeing.”