LW Hotel Advisors (LWHA) recently released its fourth-quarter U.S. lodging market update. According to Daniel Lesser, President and CEO, vaccines and booster shots paved the way for a brief return to some semblance of normalcy; however, as we enter 2022 the nearly two-year global health crisis is not over. Since the end of November 2021, the Omicron variant of COVID-19 has surged, bringing record-high daily counts of infection, resulting in many companies further delaying their long-awaited return to office. Staffing shortages and global supply chain challenges continue to wreak havoc on businesses, and Omicron has the potential to further disrupt travel, impacting the airline, hotel, and group meeting and convention industries.
The good news is that it is not a matter of if, but rather when, the COVID 19 pandemic will either end or become an endemic disease, which would be easier for the world’s population to coexist with. In the interim, the economic devastation wrought by government-mandated shutdowns and restrictions during 2020 are well on their way to healing, as even with the recent surge in cases, it does not appear that there will be additional widespread shutdowns or lockdowns.
After the isolation and/or being limited to local activities during 2020, pent-up demand for travel, particularly leisure oriented, was unleashed in 2021, culminating with U.S. hotel demand for the week between the Christmas and New Year’s Eve 2021 holidays the highest ever recorded. As work-life boundaries blur, combined with a hybrid model of producing, bleisure (business + leisure), travel will continue to grow in popularity. Although travel spending has inched back, a full recovery will not be complete until all segments return, including discretionary business and group meeting and convention patronage.