Va. hotels expect $1.5B loss in 2021 biz travel
Nationwide business travel revenue expected to be down 66%
The Virginia hotel industry expects to take a $1.5 billion loss this year stemming from sharply reduced business travel — 63.5% below pre-pandemic revenue levels, according to projections released Wednesday by the American Hotel & Lodging Association.
Business travel is expected to generate about $864.5 million for hotels in Virginia for the 2021 calendar year, down from $2.37 billion in 2019, according to the August study conducted for the AHLA by Potomac, Maryland-based Kalibri Labs, a data analytics firm focused on the hospitality industry. “Business travel” in the report refers to corporate, group, government travel, along with business from other commercial categories.
The Washington, D.C., region’s hotel market is expected to end 2021 with $371 million in business travel revenue, down almost 87% from the 2019 total. And the Virginia Beach market is projected to generate $281 million from business travel this year, a decline of about 41% from the area’s 2019 revenue.
“We’re very concerned about the lack of business travel in the state,” Virginia Restaurant, Lodging & Travel Association President Eric Terry said. “That’s what drives hotel profitability. I think it’s going to be a long time before we see the industry recover.”
The national hotel industry’s business travel revenue is projected to be down by more than $59 billion compared with 2019. National business travel revenue was down nearly $49 billion in 2020 and is not expected to reach pre-pandemic levels until 2024, according to the AHLA.
“While some industries have started rebounding from the pandemic, this report is a sobering reminder that hotels and hotel employees are still struggling,” AHLA President and CEO Chip Rogers said in a statement. “Business travel is critical to our industry’s viability, especially in the fall and winter months when leisure travel normally begins to decline.”