While Donald Trump is seen by many as the saviour of the real estate sector he is not exactly being hailed as the saviour of the hotel industry. Arne Sorenson, CEO of Marriot Hotels, has been talking about the impact Donald Trump’s travel ban is having on the hotel industry. It is very easy to get caught up in the whole immigration issue while perhaps missing the point that immigration is vital to the US economy and the US real estate sector. So, what impact is Donald Trump’s travel policy having on US hotels and their perceived value?
Middle East and North Africa numbers down
Arne Sorenson has confirmed that bookings from the Middle East and North Africa fell by up to 30% during February 2017. Even though the travel ban is still going through the courts the idea that the US is not as welcoming as it has been to visitors has done serious damage. Initially represented as a ban for those visiting from various Muslim countries the issue has taken on a life of its own. It is not just the headline visitors who are impacted by the ban but also their many staff and assistants.
In what is certainly an interesting insight into the hotel industry, it seems that visitors from the likes of the Middle East and North Africa spend a disproportionately large amount of money compared to their European counterparts. Some of the more luxurious hotels also attract the attention of royalty from area such as Dubai with entourages of between 20 and 80 people. This type of customer can rent entire floors for literally months at a time.
Impact right across the real estate market
While this is an interesting insight into the hotel industry even the idea of a blanket ban for travellers from certain parts of the world is impacting property sales. The US is seen as a great place to visit and a great place in which to do business but if visitors from the likes of the Middle East and North Africa are not welcome, will they look elsewhere?
Even the slightest tweaking in demand can have a detrimental impact on property prices which will likely soften in areas where foreign investment has been prevalent in years gone by. This comes at a time when US real estate investors are looking towards Donald Trump for inspiration and growth policies. Whether or not you agree with his travel ban on certain areas of the world perhaps he did not appreciate the full ramifications of such a move?
Lack of clarity
While Donald Trump wrestles with the legal profession to push through his travel ban there has been a distinct lack of clarity on who can and cannot travel to the US. Visitors who have been travelling for many years were suddenly drawn into the travel ban even though they came from countries such as the UK. This does not do the US reputation any good on the worldwide stage and while Donald Trump is seen as a staunch protectionist for the US economy and the US people, surely this is a step too far?