What’s in store for the Hotel Asset Management industry in 2018?28th February 2018
The industry faces a plethora of challenges this year but there is also an overall positive outlook for the future.
As one of the most influential hospitality asset management companies in the UK, at Michels & Taylor we ensure that we are always on top of industry evolutions so we are ready to face any challenges.
For 2018, there are several factors to take into account when looking at the future of the hotel asset management industry. These factors are national, international but also very local and the combination is creating a positive but unreliable outcome. Discover what the new year is expected to bring for the industry.
An Optimistic yet Uncertain Future
After the activity decline in 2016, last year brought excellent economical results. This was thanks in part to a weaker pound and guests taking longer stays with a higher average spend. Even though industry experts are optimistic for 2018, results are predicted to slow down compared to 2017.
Where there is optimism there is always uncertainty – 2018 goes beyond predictions, it is also under the influence of politics. The uncertainty linked to Brexit is making it harder for the hotel industry to strategize and plan a steady future. A massive issue is staff retention; European workers have already left the UK following the vote on the 23rd of June 2016, so hoteliers are under pressure to recruit and retain staff.
19,000 new rooms will be added to the UK market in 2018, according to AM:PM and the PWC Hotels forecast, so it goes without saying that competition is set to be fierce. The steady growth of alternative accommodation such as Air BnB will be a true test for hotels to keep a high occupancy rate. There is also competition from international markets such as China who are investing in the UK hotel industry.
Increased Technology and planned Regulations
For the past few years, smart technology has stayed on the radar and artificial intelligence has brought lots of promises; think lower costs and increased efficiency. As is always the way, there is still a high need for human interaction as A.I. cannot compete when it comes to advice, knowledge and skillsets. According to EY Wealth and Asset Management Outlook for 2018, however, technology is increasingly helping the industry by providing an incredible amount of data about clients, their needs and spending trends.
While this is a brilliant tool, it is worth being aware of the GDPR (General Data Protection Regulation) rules that will be effective from the 25th of May 2018. All companies must be compliant by the May date or they will face expensive fines – it’s all about protecting EU residents’ data records and giving more control to consumers. You can find out more about GDPR in our dedicated article.
“A lot of predictions have been made for the hotel asset management industry in 2018. It is important to be aware and anticipate the future of the industry, so we are able to strategize better the future of our hotels.”
Krupesh Patel, Head of Advisory