CHTA optimistic about 2018 bookings, despite challenges post-Irma and Maria

As the Caribbean Hotel and Tourism Association Marketplace rings in its 36th year in San Juan this week, this time around, the focus is on celebrating Puerto Rico, and the entire Caribbean's comeback, four months after devastation blew through the region in the form of two Category 5 storms, Hurricane Irma and Hurricane Maria.

Following an exhuberant welcoming ceremony which showcased several performances by the Puerto Rico Symphony Orchestra, the CHTA kicked off this year's Caribbean Travel Marketplace with a press conference and media debriefing, featuring a panel of CHTA representatives, including Frank Comito, CEO and director general, CHTA; Vanessa Ladesma, chief operating officer, CHTA; Matt Cooper, chief marketing officer, CHTA; Stacy Cox, president, Caribbean Society of Hotel Association Executives (CHSAE); and Hugh Riley, president and CEO, Caribbean Tourism Organization.

Comito opened the morning's session with a marketing update that explored the state of the CHTA, four months after the passage of both Hurricane Irma and Hurricane Maria.

"Post-hurricanes, we needed to work together and we needed intelligence out there in the marketplace moreso than ever, and you gave the world a geography lesson, because the Caribbean is incredibly vast, and when situations like this [the hurricanes] arise, we have a job to do regarding telling the story of the vastness and diversity of the Caribbean," Comito said.

Frank Comito, CEO and director general, Caribbean Hotel and Tourism Association.

In 2017, Caribbean tourism was "a bit of a mixed bag," as Comito put it, and prior to the arrival of both hurricanes, the Caribbean was expecting an all-time high as far as international tourism was considered.

"Arrivals are up, but they're below forecast, and occupancies were down slightly by 1.2 per cent according to SDR, but imagine if there were no storms," Comito said. "Had you taken the storms and their contagion effect out of the picture, which we experienced for a while, we would have had a very good year as the Caribbean."

Despite the damages brought on by both storms, room occupancy in the Caribbean is up, but the CHTA estimates that approximately 20 per cent is out of occupancy for part of the year. Room revenue has increased by $12B, which accounts for many jobs.

"We're hearing incredibly strong reports on industry performance, and there's every reason to believe that will continue," Comito said. "In terms of development, we have 25 projects in the region under construction, and 6,000 rooms, and altogether in the active pipeline, there's 74 projects reported in the region with a total of almost 18,000 rooms, so the Caribbean is indeed growing."

The CHTA reported the following statistics:

• Total revenue is mixed; 52 per cent of hotels expect an increase in revenue, and 28 per cent expect a decline.
• 68 per cent of hotels report that they'll invest more in expenditures.
• 24 per cent of hotels anticipated a net loss in 2017, and 76 per cent expected a profit (as of Jan. 2017).

"If there's $12B dollars of increased revenue throughout the Caribbean, then of course you're going to see an increase of jobs in the Caribbean as well," Comito said. "Forty-four per cent of the hotels reported an increase in their employment levels."

A Look Ahead

With the first month of 2018 officially over, the CHTA is optimistic about the future and remainder of 2018.

"Despite our challenges, we are highly optimistic about our future, and many hotels share that outlook," Comito said. "Capital expenditures are expected to increase, and properties will invest more. Room rates are expected to increase for half of the hotels, and we've not seen this side of optimism before, and it's an indication of a trend that's very exciting for us."

The hurricanes were a major factor in net loss for the Caribbean, but as the CHTA points out, other factors came into the mix as well. Airlift availability, as well as an international perception on the safety of certain regions played a major part in the number of tourists who came to the Caribbean last year.

On the other hand, strategic property and destination marketing, complemented by increased airlift out of North America and a more enhanced and well-rounded product, allowed for a spike in numbers.

Advocacy, Awareness Key

Karolin Troubetzkoy, president, Caribbean Hotel and Tourism Association and executive director of Anse Chastanet and Jade Mountain Resort, St. Lucia, provided insight on some of the challenges that have hindered the recovery of Puerto Rico and the Caribbean as a whole.

In 2016, the Zika virus came to the Caribbean, heavily disrupting the travel and tourism industry as thousands of travellers cancelled their vacations to the region over fear of catching the virus.

"The Zika virus is over, but it's not over in the minds of our travellers or in the mind of the industry," Troubetzkoy explained. "We haven't been able to completely get the Caribbean off of the health websites. Most of our destinations have been Zika-free for a year, and we're hoping that in the next few years, we finally see that the Caribbean will be taken off of the system.

Going into 2017, the CHTA had a very successful roundup of events planned, but then the hurricanes hit, which brought operations to a full-stop.

"Before the hurricanes, we never realized that there was such a poor understanding of the region," Troubetzkoy said. "Shockingly, the bookings stopped and it really didn't matter where you were; everybody was afraid to come to the Caribbean. Not everybody bought into the idea that the Caribbean was okay. The world has made it very clear - whether you believe in this idea that the Caribbean is a brand or not, the world has clearly identified us as one, and we couldn't defend ourselves once those hurricanes hit, because there was no voice out there on behalf of the Caribbean to say otherwise. We were tasked as an organization like never before to relay information to consumers and the trade. We're looking at ways to create a shared platform with the sharing economy; we were very disconnnected during the hurricanes and nobody knew who the visitors were, and this industry needs to be regulated so that if and when a crisis occurs, we know who our visitors are and where they're located."

This year, 228 suppliers came out for the 36th annual Caribbean Travel Marketplace, but overall, there are approximately 340 supplier companies which includes hotel rooms, tourist boards, attractions, and destinations. On average, the Marketplace has about 68,000 to 70,000 group inventory represented at the event, with participation from 18 international regions.

Private vs. Public Sector

A reoccuring theme of today's media sessions was the need to address the gap between the public and private sector. As Puerto Rico provided aid to its Caribbean brothers and sisters who were first hit by Hurricane Irma, the storm paid Puerto Rico a visit, and just 10 days later, blasted the island with Hurricane Maria, too.

"We saw, during the hurricane, that the MOU's that were signed in some of the regions showed that guests were unaccounted for, and that there was an opportunity for governments and the private sector to work together to make sure that the brand [the Caribbean] was not tarnished when talking about the shared economy," said Cox. "The Caribbean isn't going anywhere, and we will be working with the CTO [Caribbean Tourism Organization] and CHTA to ensure the safety, protection, and security of our brand."

A Sustainable Funding Mechanism: a Tall Order?

Despite some opinions declaring global warming as so-called 'fake news,' the Caribbean feels otherwise in light of last fall's record hurricane season. September saw the presence of two Category 5 storms just over a week apart, and while the aftermath was catastrophic, it was also a wake-up call that forced governments and tourism boards alike to spring into action, to ensure that history doesn't repeat itself.

Hugh Riley, president and CEO, Caribbean Tourism Organization.

"It's taken a tremendous amount of courage, confidence, and competence from the Puerto Rican Tourism board and the CHTA to pull this off, and it sends a very strong message to the entire industry," said Hugh Riley, president, Caribbean Tourism Organization. "Those three attributes are needed, if the Caribbean tourism industry is to fulfill its mandate for 2018. The public and private sectors are going to have to step up this year and accept the fact that we have to grow profitability in the sector and reduce unemployment; we have to increase foreign exchange earnings and we have to increase the region's competitiveness.

"It's a tall order, coming immediately after the kind of year we've had, but we have to be able to communicate these messages effectively to the travel trade, so that they have the ability to make their clients comfortable. Consumers have so many choices available, and we have to be able to communicate effectively to our own people, because we're expected as hosts to do so. All of this takes money, but it also takes courage, confidence and competence, and we need to say to our leaders in the private and public sector to market this sector appropriately. This notion of lurching from one crisis to the next has got to stop."