Normality bites 

This results season has, so far, been a cracker for people who like things normal. And let’s just nip any thoughts of philosophical discourse in the bud right now, it’s not that sort of column.

The hotel sector is largely inclined to define ‘normal’ as ‘how it was last time we were making money without having to think too hard’. No pandemics, no recessions, no naughty OTAs. Just plain sailing. It’s fair to say that in this case ‘normal’ is not the norm, but again, we’re not Freud. 

Hilton’s results were big on this normal. The ‘new normal’ which we were all committed to during and after the pandemic has finally been replaced with the good old normal, which for Hilton and chums means a return to the road warrior, fired up by delicious loyalty points.

Chris Nassetta, president & CEO, talked about leisure “normalising from super high levels”, while group demand was expected to be “finally back” in the second half of the year, with groups continuing to grow as a percentage of booking mix and booking windows continuing to lengthen.

‘Normal’ in economics refers to goods and services where demand rises along with incomes, and this season has certainly been an illustration of that. Particularly if you’re Premier Inn and Travelodge, where your services have been much in demand because of, well, falling disposable income. But you get the idea.

Premier Inn was so enthused by cheap rooms over restaurants that it is converting 112 branded restaurants and exiting 126 to “unlock” 3,500 new room extensions. A sad day for carveries around the country, but while beds never go out of fashion, queueing for sliced meats may have had its day.

At Pandox, normal was all about the financing market, with the group eager to enjoy a more welcoming one, given that it had 18% of its credit facilities with a maturity of less than a year.

Liia Nõu, CEO, said: “The risk appetite of the banks has increased and the prospects of new financing on reasonable terms are better than they have been for a long time. Combined with the fact that the markets are expecting interest rates to be lowered, this is creating the right conditions for increased activity in the transaction market, while also supporting the valuation prospects of the properties.”

This is good news for those of us who like to observe change and the shifting sands of the sector, even more so for Pandox, where deals are the business model. 

Accor was also smiling on the financial markets, having successfully placed a €600m seven-year bond, which was more than four times oversubscribed, reflecting it said: “Accor’s strong credit quality and investor confidence in its business model, growth potential and financial structure”. A business model which, we understand, will not be seeing the company hacked in half any time soon. 

There was good news for Nõu via the Hilltop Hotel Deal Tracker for the first quarter, where managing director Tom Oakden said: “Although a significant number of deals were carried over from 2023, Q1 2024 has still been about €2bn ahead of Q1 2023 for Single asset, portfolio and M&A transactions. As always, only around 50% of transactions have prices disclosed, so the actual volumes will in fact be much higher.

“London, Paris and Barcelona have been the most popular cities to invest in for both Q1 2023 and 2024, whilst vacant possession transactions accounted for over 50% of transactions. Urban transactions have nudged up to over 70%, whilst the leading type of investor, owner operators, is slightly down from Q1 2023 to just under 30%.

“M&A activity has really picked up for assets, operating businesses and brands, ranging from strategic investments to 100% ownerships, and this is likely to continue given the growth potential for the sector.”

So the new normal is the binned normal welcome back the old normal. It means a more relaxing time in board rooms, but what does it mean for the guest? The new normal meant elevated guest experiences, a sector which suddenly cared about attracting the leisure market once the road warriors had fallen away. 

As psychologist Abraham Maslow* said: “What we call ‘normal’ in psychology is really a psychopathology of the average, so undramatic and so widely spread that we don’t even notice it ordinarily.” 

Is this what we want for businesses? Maybe, share prices don’t like drama. Is this what we want for guest experiences? No.





*That’s right. We can use Google too. 

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