What Can Hotels, Guests Expect Ahead of Brexit?
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The United Kingdom's impending exit from the European Union has prompted uncertainty across a plethora of industries, including the hotel sector.
While there's still a great deal to be determined in the wake of last week's stunning Brexit vote, consensus expectations are beginning to emerge.
Speaking to TravelPulse, Ravneet Bhandari, CEO of hotel revenue management platform LodgIQ, highlighted several possible effects Brexit will have within the hotel world moving forward.
"In general, as far as demand is concerned, we should see a slowdown in corporate travel," said Bhandari. "Uncertainty is not good for corporate business in general."
But while business travel stands to slump, a boom in leisure travel has the potential to offset the impact.
"With the devaluation of the pound, we do anticipate better deals for U.S. travelers and intra-Europe travel," added Bhandari.
READ MORE: Brexit and the UK's Hotel Industry
Although Brexit's impact is already being felt, it's still far too early to make any guarantees.
"We've seen a slowdown in forward corporate booking pace for the next 14 days, but it's not significant enough," Bhandari said, adding that LodgIQ anticipates corporate travel business will be most heavily impacted in the short-term. "Somewhere in the vicinity of 3 to 5 percent."
The aforementioned devaluation of the pound accompanied by the overall uncertainty could mean cheaper prices for U.S. travelers and others looking to experience the U.K.
"As far as direct distribution is concerned, the first tendency is going to be to discount deeply," said Bhadari, discussing how hoteliers are likely to address the Brexit. He said they may also explore opportunities with OTAs, including Booking.com and Expedia.
READ MORE: Brexit and the Travel and Tourism Industry
The Brexit's impact is beginning to take shape, but Bhandari noted that the long-term impact of the vote will ultimately depend on how it's managed.
"If it ends up being jerky and choppy then we do believe that there will be downward pressure on rates," he added. "It's going to be interesting to see how it plays out."
"The uncertainty in terms of the overall environment would mean that there will most likely be deals to be had in investment."
Because it'll take a minimum of two years for the U.K. to complete its exit from the EU, travelers and those within the hotel industry shouldn't anticipate any dramatic changes in the near future.
"Over the course of the next two years things should be relatively stable."
But if the Brexit is good for travelers seeking a deal, then it also has the potential to benefit the sharing economy, according to Bhandari.
"We anticipate that Airbnb booking levels should rise at least in the next six months or so."
If demand for home-sharing platforms like Airbnb and others increase then hotels will be under additional pressure to offer competitive rates, which would ultimately benefit the guest.
More by Patrick Clarke
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