US: As Democratic presidential candidate Joe Biden looks a strong favourite to win the race for the White House, industry experts have assessed what a Biden presidency could mean for the extended stay and wider travel industries.
As this article was published, Biden had secured 253 of the 270 Electoral College votes he needed to win the presidential election, and was ahead in the count in the key states of Pennsylvania, Georgia and Arizona.
Biden and the incumbent, Republican candidate Donald Trump, have widely differing policies to managing the Covid pandemic and foreign relations. But what could a Biden win mean for the hospitality and travel sectors?
Mark Skinner, partner at Atlanta-based The Highland Group believes a Biden presidency should have a positive impact on US extended stay and serviced apartments.
“Biden’s administration intends to enact a national mask wearing mandate, a massive fiscal stimulus and much needed spending on infrastructure. If enacted the national mask wearing mandate should drive down Covid-19 infections and lift public perception about the safety of travel. This should also boost business travel as corporate mandated travel freezes are loosened because corporate travel managers will feel more comfortable sending business travellers back on the road,” said Skinner.
“The fiscal stimulus would provide businesses and individuals with more cash, some of which should be used for travel. It will also help businesses stay afloat that support the travel industry such as restaurants, theatres and visitor attractions. Infrastructure improvements are a major generator of extended stay hotel demand. While many large scale infrastructure projects are not shovel ready and, therefore, their expected boost to travel will take time, once they start they can provide significant extended stay lodging demand for several years, he added.
Andrew Harrington, partner at AHV Associates, said: “The key driver to the revival of travel and hospitality is to end the Covid nightmare ASAP. With the imminence of a vaccine, it is tempting to conclude that the end of Covid is nigh so to speak. The vaccine can certainly ensure the return to normality providing the virus is not widespread in the community. If it is, then it has to be controlled first before the vaccine can accelerate the path to normality. The US is still the biggest economy in the world, and hence the key driver to the recovery of travel and hospitality globally. The issue with the US is that there has been hitherto no coordinated national response to the virus. This has meant that, effectively, the US has had the worst of all worlds. In many parts of the country, the US is still going through the first wave and, with no coordinated national response, this means that even if it looks as if in some parts of the country the virus is under control, there is always the risk that it will return.”
“The main effect of Biden will be therefore to implement a coordinated national policy to control the impact of Covid 19. Who knows what the state of the country will be when he takes office, and much of policy is determined but the states, but it is clear that there is a lot he can do now by using his influence as the president elect to promote national action. With a nationally coordinated policy, the question now becomes what will the state of the US economy be post Covid? Although the US govt has been very responsive in its support for business etc during the crisis, some of the key measures expired in July and their replacement is bogged down in partisan arguments in Congress. It looks unlikely that the Democrats will take control of the Senate in January in which case a new recovery package, if it passes, is not likely to be very generous. So, the effect of Biden winning the presidency is likely to be positive compared with the current situation as it will hasten the end of Covid in the US, which will have substantial implications in travel and hospitality globally, but the divided Congress will mean that the US economic recovery may not be as rapid as it otherwise would have been, thus potentially dampening the recovery of travel and hospitality in the US and around the world,” he added.
Parker Stanberry, co-founder and CEO, Oasis Collection, said: “A Biden win likely moves the USA towards actually addressing the pandemic and trying to mitigate it, vs. the herd immunity-type approach that Trump favours. I think that makes America and Americans safer, which should encourage open borders and make domestic travel safer, which helps everyone in travel as well as short-term rentals. The general mood in, and tone of, the country will be lighter – especially vis-a-vis foreigners, which again may encourage travel.
Philip Kennard, CEO and co-founder of softare provider Futurestay, said: “Biden intends to pass a $2 trillion stimulus largely focused on re-energising household spending, throwing small business a lifeline, and allowing state / local governments to expand infrastructure and Covid response via hiring. As we saw with the $1200 Covid stimulus checks to middle class Americans in Q3, a direct injection of billions into the economy caused a surge across retail and travel activity. If it passed soon after the Inauguration Day in late January 2021, this could jumpstart a strong spring travel season in short-term rentals.”
“And most importantly, in the long-term, a Biden presidency means a mandated, coordinated Covid response – possibly even one that the international community can align on. I’m not a medical professional so I’ll refrain from predicting what impact that will have on infection curves, but here’s why that matters. In a July study, 71 per cent of travellers indicated they preferred to stay in accommodations with contactless and touchless options over those that didn’t offer them. Many consumers, including myself, feel more comfortable shopping, dining out and even flying, when I know there’s a shared set of rules, tools and protocols in place to protect me and my family. Biden’s plan to mandate Covid standards for businesses may increase demand by reducing risk and fear of infection, in addition to any impact it has on the pandemic,” he added.
Click here to see the industry’s response to Donald Trump’s win in 2016.
