Hospitality and Real Estate in 2020
The impact of Covid-19 weighed heavily on the Hospitality and Real Estate sectors, impacting the ways we work, live and invest.
Real Estate leaders had to respond swiftly as lockdown, work-from-home and safe distancing requirements swept across the globe. In the initial months, this meant centralising cash management, reviewing capital expenditure and evaluating portfolio investments. This eventually transitioned to reinventing and digitalising in a bid to retain tenants/ customers and enhance their experience. This led to a demand for real estate and technology leaders who are agile and innovative in transforming traditional business models and integrating digital capabilities across the organisation.
Despite the economic headwinds and short-term uncertainty, international investors remain committed to key Asia Pacific markets. In fact, investors are capitalising on opportunities within defensive, operationally critical sectors, including logistics, data centres, multi-family and other alternatives.
Separately, distressed deals could emerge where hotel assets need to be redeveloped or repositioned. Investment professionals with transaction experience in logistics and alternative assets are the current favourites for diversified real estate organisations looking to enhance their current portfolios. In addition, as developers look to green financing as an integral part of their capital management strategy, sustainability experts who can advocate and advance ‘go green’ initiatives could potentially be in demand.
Some might say that Covid-19 has left a trail of destruction within the hospitality sector. The absence of leisure and business travel are particularly felt in markets like Hong Kong, Singapore and Thailand. Domestic tourism is helping to counter the lack of international arrivals in markets like China and Vietnam. That said, with low occupancy rates and RevPar across most markets, many hospitality organisations had to future proof their operations, leading to redundancy across multiple functions and markets.
Travel will return, albeit at a different pace for leisure, business, domestic and international travellers. The new reality will require hospitality leaders to revise their strategy and manage their customer expectations, particularly in the areas of hygiene, safety and flexibility. Until then, hiring sentiment is likely to be muted as the hospitality sector face a long road to recovery.
Take a look at the 2020 Predictions vs Reality mini-series so far:
- Overview: 2020 Predictions vs Reality
- Sales & Marketing: 2020 Predictions vs Reality
- Consumer & Retail: 2020 Predictions vs Reality
- Food & Nutrition: 2020 Predictions vs Reality
- Semiconductor: 2020 Predictions vs Reality
- Chemical, Commodities, Oil & Gas: 2020 Predictions vs Reality
- Supply Chain & Procurement: 2020 Predictions vs Reality
- Human Resources: 2020 Predictions vs Reality