Italy was the first major Western European country to be massively affected by covid-19. At the height of the pandemic, the number of overnight stays fell between 90% (March) and 98% (May). Over the first five months of the year, the number of overnight stays fell by 68%, according to the consultancy Horwath-HTL. The summer season barely brought a slight improvement in the situation of the Italian hotel industry, following the reopening of the country to European visitors in June. Occupancy rates hovered around 20% in Milan and Rome, and 15% in Venice..
The Italian Confederation of Enterprises reported in early September that 70 % of hotels in cities like Rome and Florence and 20 % in coastal areas never reopened following the total quarantine of the country. The Italian National Institute of Statistics indicates that 60 % of companies in the sector fear a financial meltdown in the coming months.
No return to normality before the end of 2021
This pessimistic view is confirmed by the Horwath-HTL survey. Carried out in June, it represents a snapshot of the feelings of 81 hotel managers located throughout the Peninsula. Hoteliers are not very optimistic about a return to "operational normality". 64% of respondents actually expect no improvement before 2021. 45.7% think it will take more than a year, and 29.6% think it will take 10 to 12 months.
For the first half of 2020, hoteliers were anticipating an overall drop of more than 80% in occupancy and revenue. Only 17% of respondents were less pessimistic, forecasting a fall in average revenue per room of 25% over the year as a whole.
While the Italian hotel federation puts the profitability of establishments at over 70%, the Horwath-HTL survey shows that Italian hoteliers anticipate occupancy rates in the range 11% to 40% for the last quarter.
20% of respondents predict occupancy between 31% and 40% and 17% between 11% and 20%. One glimmer of optimism: 27% of hoteliers in the economy segment expected occupancy rates of between 70% and 80%.
Investment boosted by the pandemic
Another worrying sign from the survey: hoteliers do not believe in a recovery in business travel and MICE activities. 62% of respondents think that international business travel will not pick up this year. This figure rises to 74% for congresses and incentive travel.
Did the covid-19 crisis have a single positive effect? Yes, and surprisingly so. The Horwath-HTL survey shows that 74% of respondents have invested in hygiene measures and service standards. Many of them say they have also taken advantage of the closures to carry out major renovations to their establishments.
Italian hotels of the highest standards are waiting to welcome business travellers... when they resume their travels. But all roads lead to Rome, they say!
