Almost half of hotels expect to close by the year’s end

Almost half of the hotels in Portugal plan to close by the end of the year and groups with several hotels admit to closing 56% of them, the Portuguese Hotel Association (AHP) said on Wednesday.

According to the ‘flash’ survey ‘Hotel closures 2020/2021’, the results of which were presented today at an online press conference by the Association’s CEO, Cristina Siza Vieira, 45% of respondents expect to close by the end of the year.

Of those planning to close by the end of the year, the Algarve region stands out, with 65% of the hotels saying they would close by the end of December, of which 70% were already closed in November.

Next comes the Autonomous Region of Madeira, with 57% of those surveyed planning to close by the end of the year, all of which were already closed in November.

In Lisbon, 46% replied that they were closed by the end of the year, with 93% not opening in November.

The average time they will stay closed is 4.1 months from November onwards.

This means that 46.4% estimated to open in March 2021, 23.7% said they had not yet forecast when to open and 16.9% pointed to reopening for the second quarter of next year.

Of those who said they would close, only one respondent said they would not open again, but AHP stressed that it did not work with sole proprietors.

As for the establishments that remain open, it is estimated that there will be a 72% reduction in the number of rooms on offer.

When asked whether they would consider intermittent use of their establishment (opening, for example, at weekends or for events), 40% responded that they were willing to open part-time.

In Alentejo, 70% said they only open on weekends, and the AHP received complaints from businesspeople in that region regarding restrictions imposed by the government over the last two long weekends.

In terms of government support, 65% resorted to extraordinary support for the upturn, specifically in terms of reducing the normal working period.

Of these, more than 80% resorted to the reduction of the normal working period, between 41% and 100% reduction.

“As the performance of Alentejo was quite interesting in the summer, compared to others, 65% in the hotels did not resort to the reduction of the working period”, explained Vieira.

She also left a challenge to Tourismo de Portugal, saying that strengthening Portugal’s image in the main tourist source markets, such as the United Kingdom and Germany, should be in line with the vaccination plans of those markets, i.e. which age groups will be given priority for vaccination in those countries.

With regard to estimates of hotel losses for 2020, the AHP maintains the forecasts it had already made: an 80% loss of overnight stays, which means 46.4 million, and an 80% drop in revenue, a total of €3.6 billion lost revenue in the hotel sector.

“Our estimates are currently the worst-case scenario, 80% nationally, also considering the islands”, she said.