The Outlook for the Hotel Business in the Dominican Republic
By Joe Pike, Special Contributor
Lucien Echavarria, Northeast director of the Dominican Republic Ministry of Tourism, is both optimistic and cautious when predicting just how and when her country’s hotels will reopen to the world following the coronavirus.
Echavarria, who spent most of her career involved in the hotel business, said she doesn’t expect there to be a lot of selling and purchasing of hotels in the D.R. following the pandemic because most of the properties that were affected are “big enough brand names” to afford the shutdown period, and move forward with re-openings.
In fact, Echavarria told Caribbean Journal Invest (CJI) that some of the country’s hotels are actually hoping to open by June 1. She did add that it was “extremely” wishful thinking, but several big-name hotels are gearing up for a June 1 opening just in case.
However, it can be assumed that these hotels will only be serving domestic guests as most American air carriers may not be fully operational by then.
And once the airlines are open, there will also be a question of demand. Will people immediately feel safe to travel once the pandemic ends or will there be a waiting period?
“I think we are positioned well as a destination because we are perceived as safe and we are close,” she said. “The Caribbean will be among the fastest to recover. Europe? I’m not sure how long people are going to avoid long trips, but I know the Caribbean, Mexico and Hawaii will rebound faster than most places.”
And what niche market does she expect to bounce back the strongest?
“The hotels that will see the fastest recovery will be those who cater to the high-end customer,” she said. “The luxury market will be the first to see a boom because the wealthy traveler will be the first to travel. They have the money to buy whatever they need to feel safe, to customize their trip however they want. And they are starving to travel. Money will not be an option for them.”
Apple Leisure Group Vacations’ Forecast for Hotel Partners
Ray Snisky, executive vice president and chief commercial officer for Apple Leisure Group Vacations (ALGV), chatted with CJI about the impact the pandemic is having on ALGV’s hotel partners in the Dominican Republic, as well as some strategies for both hotel buyers and sellers to resume business as usual.
“Resorts and hotels are working on their protocols now,” said Snisky. “The one silver lining of this is there is time to plan and implement a ‘new norm’ as it pertains to servicing the customers.
“This will be our new norm for a period of time,” continued Snisky. “The reality is our clients will be experiencing this in their hometowns, so I believe it won’t be a huge difference to accept on a beach vacation.”
Snisky added that all of ALGV’s platforms are currently being used to communicate, educate and drive value for clients and travel agents.
“We are an extension of the destinations’ and hoteliers’ marketing reach,” he said. “We also serve as the glue that holds all of the various travel components together.”
So, what does he think the traveling landscape will look like when the pandemic finally ends?
“I see an environment where clients will take advantage of services like private transfers, and they will deviate from large, crowded buffets,” said Snisky. “I see enhanced room service menus, physical distancing at the pool, tables at restaurants and public areas, likely hotel employees will be wearing gloves and masks.”
In fact, both Snisky and Echavarria told CJI they expect cleanliness to be a new top priority at most hotels and cleaning products, such as Purell hand sanitizer, could be used as a new hotel amenity.
“Likely you will see changes in how they are servicing customers, from distancing protocols, to slowly ramping up based on demand,” said Snisky. “You will see hotels open over time and likely chains will open a few of their hotels at a time to ensure they don’t have too much inventory available until demand returns fully. Most likely, we see some guests return over the summer with a stronger ramp up in fall.”
And although it’s hard to think about now, CJI had to ask Snisky what the hotels were doing to prepare for an overwhelmingly large amount of bookings since the traveling public has been deprived of vacations for months now.
“Well, of all the challenges we have been dealing with that one would sure be a welcomed one,” said Snisky. “Too many bookings is not anything we are worried about and would actually love to have to tackle that challenge. All kidding aside, the hotels are creatively looking at how to come back and come back in a new way.”
Hotels in Development Phases
Frank Comito, CEO and director general of the Caribbean Hotel and Tourism Association (CHTA), recently told CJI that the Dominican Republic had the most hotels, 36, in the Caribbean that were either under construction or in the early planning stages, and are now all halted.
“As far as resuming construction projects, that’s going to be a case-by-case thing that will depend on hotels’ schedule dates of construction and also how much cash flow was lost during the pandemic,” said Echavarria.
More than 130 hotel projects have been delayed in the Caribbean due to the ongoing coronavirus (COVID-19) pandemic, said Comito.
Comito, who attributed all statistics to STR, formerly Smith Travel Research, told CJI that of the total 133 stalled projects, 62 were under construction and 71 were in “some form of planning phase.”
AMResorts Looks to Rebrand Two Dominican Republic Hotels
Luis F. Nuñez, regional commercial director for AMResorts in the Dominican Republic, told CJI that the all-inclusive company plans rebrand two of its existing Dominican Republic properties once the COVID-19 pandemic has concluded.
“We are taking advantage of this down time to switch names and brands of two properties that are adjacent [to one another],” he told CJI in an email, “while at the same time, some improvements are [being] done.”
An AMResorts spokesperson told CJI the company would not comment any further about the rebranding plans “at this point.” However, Echavarria did confirm that two AMResorts properties will be consolidated once they begin accepting guests again.
She told CJI the two properties are Secrets Royal Beach Punta Cana and the Now Larimar Resort. She told CJI that AMResorts plans to remove the “Larimar” name and brand both hotels as one resort, so it can be assumed that the “Now” name will also be removed, and that hotel will be absorbed under the company’s Secrets product.