Search Travel Market Report

cruise planners
mainlogo
www.travelmarketreport.com
  • News
  • Tours & Packages
  • Cruise
  • Hotels & Resorts
  • Destinations
  • Retail Strategies
  • Niche & Luxury
  • Well-Being Travel
  • Training & Events
  • Who We Are
    • Anne Marie Moebes
    • Brian Israel
    • Dan McCarthy
    • Denise Caiazzo
    • Marilee Crocker
    • Paul M. Ruden
    • Dori Saltzman

Wyndham ‘Well Positioned’ for COVID-19 Recovery

by Jessica Montevago / May 11, 2020
Wyndham ‘Well Positioned’ for COVID-19 Recovery

Wyndham, which owns brands like Days Inn, Super 8, and La Quinta, has nearly 5,900 of its 6,300 U.S. hotels open. Photo: Shutterstock.com. 


Wyndham’s asset-light select service franchise business model and portfolio in the economy and mid-scale segments will help it survive the COVID-19 pandemic, company executives said during the first-quarter earnings call last week.

CEO Geoffrey Ballotti said Wyndham brands are poised for a quick recovery when travel demand returns.

“Our customer profile in the U.S. is about 70% leisure and 90% drive-to, making us less reliant on business days and air travel.” Ballotti said. “While the impact of Covid-19 continues to evolve, as this pandemic abates in the U.S., our franchisees should be the first to benefit.”

Wyndham, which owns brands like Days Inn, Super 8, and La Quinta, has nearly 5,900 of its 6,300 U.S. hotels open, with about 90% of them located outside of major cities in leisure-friendly drive-to destinations, which will be among the first to return once travel rebounds.

“As people begin to travel and we begin to see and believe that they will, the first thing they want to do is get in their car and drive to visit family members and friends,” Ballotti said.

In China, nearly 1,400 hotels of 1,600 are now operating and registering occupancy gains. At the peak of COVID-19, approximately 1,200 hotels were shuttered. In the past two weeks, numbers in the single digits and teens have climbed to around 20%, Ballotti said, adding it’s “encouraging” to begin to see leisure travel pick up in China.

In the select service space, a majority of Wydham’s portfolio, hotels are less labor-intensive and typically, operate at higher margins than full-service hotels. Ballotti said majority of Wyndham hotels can support debt service at occupancy levels of approximately 30% before receiving any governmental assistance which lowers this 30% breakeven considerably.

Revenues declined 12% to $410 million, compared with $468 million during the same period last year.   

RevPAR at franchised hotels dropped 23% globally due to COVID-19 travel restrictions. U.S. properties averaged a 17% decline, while those in China plunged 70%. Internationally, Wyndham hotels saw a 37 decline in RevPAR. Wyndham’s managed portfolio registered a 21% drop in RevPAR overall. Executives said they cannot predict future RevPAR trending given all the uncertainty.

Converting independent hotels to brands has always been an important part of Wyndham's consistent room growth through both up and down cycles. With over 15,000 independent economy and mid-scale hotels in the United States, Ballotti said development efforts would focus heavily on conversion candidates. This approach helped expand Wyndham’s system 3% grow during the 2008-09 global financial crisis. Of projects in the pipeline, about 52% are conversions, and 85% of US hotels added in the first quarter were conversions, he noted.

“Independents are not receiving the support that many of their branded competitors are,” Ballotti noted. “We opened 60% more rooms in '08 and 40% more rooms in '09 than we did in 2019, and the majority of that came from independents. And I think that is going to be the case, coming out of this in 2021, 2022, 2023, where independents will be much more likely to consider.”

  12
  0
Riviera

MOST VIEWED

Brought To You By
  1. European Union Will Drop Its Mask Mandate for Travel Next Week
  2. 5 Client Types You Can Immediately Disqualify for a Virgin Voyages Cruise
  3. CDC Moves Four Destinations Into “High” Risk COVID-19 Level
  4. How Is the War in Ukraine Affecting the European River Cruise 2022 Season?
  5. Trivago Hit With Massive Fine from Australian Federal Court Because of “Misleading” Conduct
  6. American Express Confirms End to its Franchise Program

MOST EMAILED

Brought To You By
  1. European Union Will Drop Its Mask Mandate for Travel Next Week
  2. Japan Could Reopen to North Americans Next Month
  3. Japan Confirms Plan to Start Its Travel Reopening This Month
  4. 5 Client Types You Can Immediately Disqualify for a Virgin Voyages Cruise
  5. CDC Moves Four Destinations Into “High” Risk COVID-19 Level
  6. Advising Clients in a Maskless Travel World
Riviera Box
TMR Subscription

Subscribe today to receive daily in-depth coverage, analysis of industry news, trends and issues that affect how you do business. Subscribe now for free.

Subscribe to TMR

Top Stories
New Hotel Opening: Hilton’s Slate Denver, the Mile High City’s Newest Property
New Hotel Opening: Hilton’s Slate Denver, the Mile High City’s Newest Property

The hotel sits at the former site of the Emily Griffith Opportunity School, one of the first-ever U.S. trade schools. 

Read...
Playa Hotels & Marriott Partner on Punta Cana All-Inclusive
Playa Hotels & Marriott Partner on Punta Cana All-Inclusive

The property is the former Sanctuary Cap Cana.

Read...
New Hotel Opening: AC Hotel by Marriott Melbourne Southbank
New Hotel Opening: AC Hotel by Marriott Melbourne Southbank

The debut Australia property from AC Hotels by Marriott has officially opened in Melbourne.

Read...
JW Marriott Is Coming to Tokyo in 2025
JW Marriott Is Coming to Tokyo in 2025

The hotel will occupy floors in the new Takanawa Gateway Urban Development project. 

Read...
Sandals Resorts Continues Its Expansion Across the Caribbean
Sandals Resorts Continues Its Expansion Across the Caribbean

Sandals intends to double its resort portfolio over the next decade. 

Read...
The Four Seasons Is Bringing a Luxury Resort and Residences to Oman
The Four Seasons Is Bringing a Luxury Resort and Residences to Oman

Four Seasons Hotels and Resorts this week unveiled plans for its newest resort in Muscat, Oman.

Read...
TMR Outlooks
Multi-Gen Outlook
Distribution Outlook (1)
New to Cruise Outlook
Expedition 2020
Wellness Outlook
River Cruise Outlook 2019
View All
Advertiser's Voice
https://img.youtube.com/vi/87ira8MA_b8/0.jpg
MasterAdvisor: What's Trending in the Cruise Industry?
About Travel Market Report Mission Editorial Staff Advisory Board Advertise
TMR Resources Webinars Calendar of Events
Subscribe to TMR
Select Language
Do You Have an Idea Email
editor@travelmarketreport.com
Give Us a Call
1-(516) 730-3097
Drop Us a Note
Travel Market Report
71 Audrey Ave, Oyster Bay, NY 11771
News|Leisure Travel|Land Vacations|Cruise|Canada Retail Strategies|Well-Being|Luxury|Training
© 2005 - 2022 Travel Market Report, an American Marketing Group Inc. Company All Rights Reserved | 243 South Street, Oyster Bay, NY, 11771 USA | Telephone (516) 730-3097| Terms and Conditions
Cookie Policy Privacy Policy