Forecast Shows Manhattan Hotel Rates To Rise

Manhattan hotel rates will increase slightly this year and by much greater levels in the subsequent years, but it will still take several years for rates to reach 2008 levels, according to the 2010 Manhattan Hotel Market Overview, which HVS Global Hospitality Services and New York University's Tisch Center released this week.

HVS forecasts that year-over-year Manhattan hotel rates will be up 2.2 percent in 2010, by 7.9 percent in 2011 and by double-digit levels in the two years after that. Considering the 22.8 percent year-over-year drop in rates in 2009 reported by Smith Travel Research, however, Manhattan average daily rates will not pass the $300 threshold, where they were in 2008, until 2013, according to the forecast.

The forecast said Manhattan revenue per available room also would reach pre-recession levels by 2013.

The report also included a survey of 68 Manhattan hoteliers, in which more than half said they expected corporate rates to increase between 1 percent and 10 percent by the end of this year. Hoteliers were less bullish on group rates, however. Just under 30 percent said they expected group rates to remain level throughout the rest of the year, while only 10 percent said corporate rates would be flat.

Icelandic Ash Cloud Hangs Over Chicago Meeting

As Iceland's Eyjafjallajokull volcano continued to pump flight-halting ash into European airspace, travel buyers and suppliers attending the Association of Corporate Travel Executives Global Education Conference brainstormed strategies to manage travel in the face of unprecedented disruptions.

"We've had several wars, massive terrorist threats, diseases and all kinds of things, but none of them even came close to the effect of a 3,000-year-old volcano," incoming ACTE president Chris Crowley said. "If it continues to grow, we will see a major effect on the cost of the airlines and the ability of the airlines to maintain certain routes."

During a press briefing at the conference, Crowley said the organization is preparing a white paper to "crystallize lessons learned" from the eruption. The research will look at ways travel managers can react to airport closings, methods of communicating with stranded travelers, criteria for when to open airspace and how to work as an industry to cover cost in such disruptions.

Recognized for her efforts in enhancing hotel rate-loading accuracy and using a mobile platform for traveler communications with ACTE's Advancing the Industry Award during the conference, Maria Chevalier, Johnson & Johnson's global director of travel and meetings services, led an interactive session on lessons learned in the aftermath of Eyjafjallajokull's ash, which will be used by ACTE and International SOS Assistance to create the white paper and a LinkedIn forum on the topic.

Chevalier noted that J&J had 1,100 stranded travelers during the April eruption, with a financial impact in the millions, while industry estimates put the cost of the first six days of the shutdown at $1.9 billion.

Sifting through the ashes of the disaster, session attendees talked about what worked when the skies didn't. Meeting at tables designated for discussing specific aspects of the crisis management process, there was a great deal of consensus. Preferred suppliers generally came through. While there were hotels that gouged, many others accommodated their guests beyond their original reservations. Credit card issuers raised limits to accommodate longer-than-usual stays. Security firms and travel management companies helped identify employee whereabouts and communicate the most effective strategies for addressing the situation.

Many companies found that the best strategy was to tell travelers to stay put, ensuring their safety and shelter. Many also found that frequent communications and multiple contact points were essential.

Of the things participants said didn't work, some cited gaps in TMC reporting and a high level of no-shows at airlines. Many cited call lines that couldn't support the volume, less visibility into the impact on their travelers over time and the fact that not every traveler carries communications devices with international capabilities.

HRG Counts Cost Control, Technology In Fiscal Year Pre-Tax Profit

Severe cuts to public sector travel budgets are no reason for a travel management companies to panic, according to the chief executives of one the largest global agencies.

HRG boss David Radcliffe was speaking to ABTN this morning (May 26) after his company released its financial result for the year until March 31, which included 15% year-on-year increase in profits before tax and an overall 7% drop in total revenue.

Yesterday the new Chancellor of the Exchequer, George Osborne, confirmed that government travel budgets would be slashed as part of the effort to reduce the UK's burgeoning deficit.
HRG's contracts with the Ministry of Defense and the Foreign and Commonwealth Office were on Osborne's list of affected departments. But a bullish Radcliffe said the company was viewing the news "opportunistically".

"Whether there are cuts or not, there will still be a lot of work for us to manage [with the FCO and MoD]. Bear in a mind a lot of the work we do is to save them money. So we view this as an opportunity to get to other government departments to save them money. We believe we can help the government meet its objectives."


HRG's preliminary results revealed the company made £326.8 million total revenue for the year until March 31, down 7% on the previous 12 months.

Radcliffe said was pleased with the result, which sees investors receive 1.2 pence per share in dividend, and said the results were cause for "cautious optimism".

But he resented any suggestion that the strong performance was down to pure cost cutting.

"I prefer not to call it cost cutting," he said. "It's a reshaping the business.

"We took a view, like a lot of other industries, that our own revenue was going to go down, so what we needed to do was reshape the business to maximise the opportunity.

"If it was just cost cutting you wouldn't necessarily seen the margin increase at the same time."
He said he wanted the business to be "in the right place" to benefit from the economic upturn.

"We things began to turn we wanted to take some benefit. So we are cautiously optimistic. In the closing days of last year and the opening days of this year we have seen some signs of a pick up."


Radcliffe admitted that redundancies were necessary during the ‘business reshape' (according to HRG's annual figures the average number of staff employed by the Group including key management fell by 917 people to 5,319 between March 31 2009 and March 31 2010), but revealed that the company was now in a position to increase headcount in certain areas.

"We lost some people over the year, but since then we've made some incredibly good signings. So we are gently recruiting where necessary."

CDS Groupe - Worldmeetings network

Meetings & Bookings Management Services

CDS Groupe / Worldmeetings offers a wide range of services for the management of corporate meetings booked into hotels and meeting venues, all over the world. Service centres are available in various countries providing personal support to meeting planners nationally, both for their domestic and outgoing bookings.

CDS Groupe offers its clients 3 online booking plateforms of services :

Meetings

Bookings

Event

The future of hotel meeting bookings is online

Online availability, rates and booking capabilities will become standard for small meetings and events at hotels within the next three years, according to a Hotel Booking Agent Association survey.

The survey of 73 member hotel booking agents (HBAs) found a growing appetite for online solutions to better manage booking processes in the transient accommodation sector and, increasingly, in meetings management.

The need for cost savings was the most prevalent driver of the adoption of new technologies, as agencies sought to reduce overheads. Speed of response to ascertain availability and rates was ranked second driven by the desire to offer a quick and responsive customer service.

One of the key uses of online technology was the management of specially negotiated allocations for bedrooms and rates on behalf of a specific corporate client at individual hotels.

The research also found only one organisation attained rates from multiple web sites including third party aggregators. Of the agencies whose core business stream was accommodation, all had live available connectivity either with GDS, Pegasus or Direct Connects with hotel brands directly.

Hotel groups, chain venues and independent properties are already opening their inventories for small meetings and all agencies agreed that online availability, rates and booking capabilities would become standard for small meetings and events within the next three years.

Trevor Elswood, chairman of the HBAA’s Technology, Innovation & Environment (TIE) Committee, said: “Traditionally HBA’s were reliant on dealing directly with properties to negotiate rates and secure inventory. Agencies are now well versed in managing accommodation policies on behalf of their corporates online through the wide range of live availability distribution connections. The corporates’ growing reliance on HBA’s as part of the business outsourcing process means that meetings management policies too are being integrated into online inventories. The survey clearly shows demand from our members who want to capitalise on the IT available, and in turn reduce their own overheads.”

KDS Taps Oracle Exec To Lead Sales

Travel and expense management technology supplier KDS has hired former Oracle executive Dean Forbes to head its global sales and marketing team.

The former Oracle group vice president of project and portfolio management solutions joined KDS as executive vice president for worldwide sales and marketing, KDS said last month. Forbes said he aimed to strengthen KDS's position in the expense and online booking markets both in Europe, where KDS has its strongest presence, and globally.

"Over the next year, without being specific, we have some aggressive plans to grow the business," Forbes said. "We're certainly in a high-energy, growth mode."

Forbes also led sales for project portfolio management supplier Primavera, which was acquired by Oracle in 2008, and Forbes said that role would inform his work with KDS. "This was a company that had not maximized its position out in the marketplace," Forbes said. "We were able to both globalize and localize that company and enter new markets over a very aggressive timeframe."

Forbes also has worked in management positions at both Motorola and Isis Communications.