Extended-stay is here to stay
Despite the many challenges posed by the global pandemic, the GCC’s hospitality sector has shown impressive resilience in recent years. While current market trends suggest otherwise, it’s not to say the pandemic has failed to leave its mark on the sector. On the contrary, our industry has witnessed several pronounced shifts in visitor habits, directly and indirectly attributable to lockdowns and travel restrictions.
What’s changed and how?
A prime example is the rise of extended-stay hotels. The normalisation of working from home has created previously unseen levels of demand for extended and ‘work away’ holidays. Our recent white paper, Echo of the future, notes that during Covid, extended stays provided a safe place for frontline workers and those still travelling on business.
Extended stays are on the rise thanks to increasing numbers of ‘digital nomads’ - people who travel the world while working online in search of the perfect work-life balance
The demographic of travellers is also changing. As Echo of the Future points out, Generation Z now dominates the world’s travelling population, and with this comes new requirements. More than 80 per cent of Gen Z travellers consider budget when making booking decisions, and 56 per cent prefer to stay in accommodation with eco-friendly benefits. As an industry, we must be aware of these types of preferences if we are to harness growth within this demographic.
The global extended stays market was valued at $48.6 billion in 2022 and is projected to reach $132.4 billion by 2032. The upshot being that travellers and tourists are increasingly looking for extended stays, whether travelling for business, visiting while on assignment/long-term projects, or merely doing business while travelling. The GCC is the ideal destination for this type of travel, thanks to the region’s wide range of cultural experiences, landmarks, and activities.
As well as this, the UAE, for instance, has established itself as a global business hub with a thriving start-up and SME scene, making it the perfect location for those travelling for business/while working. The UAE is also home to one of the world’s top 20 financial centres, a major engine for economic growth.
Providing more hotels in the GCC equipped for extended stays (e.g., rooms with kitchens, free Wi-Fi for work purposes, etc.) will ensure the region’s hospitality sector can flourish while catering to broader industry trends. Wyndham Hotels & Resorts is well placed to meet demand within this growing sector, thanks to the high-quality yet affordable accommodation that it offers across the Gulf and beyond.
What does this mean for the GCC’s hospitality sector?
Hotels will be able to fill their rooms for longer, reducing fluctuation in demand. With travellers remaining for lengthier periods, the impact that off-peak periods would normally have on hoteliers will be lessened.
Extended stays are on the rise thanks to increasing numbers of ‘digital nomads’ – people who travel the world while working online in search of the perfect work-life balance. The popularity of this trend lies in the fact that by travelling this way, people can experience the world and its cultures irrespective of their annual leave allowance. The speed at which this movement has taken off in recent years means that it will rapidly become the new normal. As such, hoteliers will benefit considerably if they embrace it sooner rather than later.
The trend also contributes significantly to the global business travel market, which is predicted to return to its 2019 pre-pandemic levels of $ 1.4 trillion by 2024. The GCC has responded to growth by increasing the number of apartments offering an extended stay service. Not only will this benefit the ‘bleisure’ traveller, but it will also allow hotels to accommodate groups for the duration of large-scale events more efficiently.
It is important that we pay close attention to what is driving demand within our sector. By continuously evaluating our offering and ensuring that we are doing everything in our power to meet the ever-evolving requirements of our visitors, hospitality brands can expedite their return to pre-pandemic levels – and accelerate from there.
Market analysis shows that the appetite for extended-stay hotels is increasing considerably, and judging by its existing inventory, the GCC is ideally placed to lead the world in meeting this demand.
* The writer is Market Managing Director, Turkiye, Middle East, Eurasia & Africa for Wyndham Hotels & Resorts (stand HC0605)