Staycationers eye up ‘business-only’ hotels

If you thought WFH meant craving human interaction and those water cooler moments, think again. For a growing number of people are choosing to Work From Hotels, fuelling a new ‘WFH’ trend, says hotel veteran Lionel Benjamin, the co-founder of new UK hotels group, AGO Hotels.

The message from the government from Monday was no longer to work from home, but Benjamin, who has worked in the hotel sector for nearly three decades, says: “There is a growth in the market for people who need a break from working at home and may not be ready to return to the office – those looking to WFH – work from hotels. Hotels provide the service corporates are looking for, as long as they have great Wi–Fi and you can have food and drink delivered safely.”

The demographic of those checking in to hotels Monday to Thursday evenings has changed significantly, says Benjamin. “Working remotely and from home can be very difficult for many. Unreliable connectivity and background noise are consistently raised as stressful issues.

Younger people are the most likely to live in flats and share workspaces, amplifying the challenges of working from home. Parents and children requiring space and internet access simultaneously creates a breeding ground for tension.

Especially among these demographics, we are seeing people opting to work from hotels, which offer outstanding connectivity and quiet spaces, the ability to enjoy a snack or even squeeze in a gym session. This is a new version of work-life balance.

“Young professionals will often opt to work from a specific hotel as a springboard for their weekend. In addition to quiet working space, holiday days are at a premium.

“We are increasingly seeing people choosing a well-located economy hotel near the coast, a national park, or a new city, knowing they will be able to work productively and then get out and explore as soon as they turn off the laptop.”

And it’s the rise of these ‘third offices’, alongside a surge in staycations that will help drive the recovery of the UK’s hotel sector, which has been decimated by the pandemic.

AGO, which specialises in budget hotels and includes several ‘Ibis budget’ hotels in its portfolio, has seen business bookings pick up from ‘staycationers’ for hotels that were previously seen as business only. And even though restrictions on international travel have eased for double-jabbed tourists, Benjamin is noticing a sustained interest in UK breaks.

“Location is key – hence we’re seeing interest in our Portishead marina hotel to access some of the country’s most outstanding beaches, and our Lancaster hotel as a gateway hub, only 30 mins outside the Lake District.”

Benjamin co-founded the company in July 2020 as an alternative platform for hotel owners and operators in the budget hotels sector. The idea was to offer a hybrid lease model, meaning that asset owners are offered a guaranteed priority-paid rent as downside protection, and also profit participation for when hotels are doing well.  

This differs from the current model – asset owners are the first to have rents reduced in a downturn, but have no share in the profits when markets are performing well. AGO’s first brand is with international hotels group Accor and includes nine Ibis hotels.

Formerly, Benjamin managed Sol and Eddie Zakay’s Topland’s £1bn hotel portfolio, and has held management roles at the Athenaeum, the Grand Hyatt Jerusalem and The Savoy. He prepared the Hilton London Metropole for sale in 2006, the company’s then-largest asset. But his focus is now on the  industry’s economy sector, which according to a PwC report will return to pre-pandemic levels faster than the top end, owing to shifts towards lower-priced travel.

“Financial and job uncertainty in the wake of the pandemic has shifted people’s focus to affordable and competitively priced travel,” acknowledges Benjamin.

“People choosing economy options are discerning travellers looking for value who will select a hotel with a few non-negotiables – convenience, hygiene and comfort. All quality economy hotels should meet these standards. After an extended period of economic uncertainty, people will be looking for an affordable place to stay.

“Some travellers will only ever be looking for luxury. For others, a luxury hotel is an option for a significant birthday or anniversary, not a casual weekend away or a longer family holiday. Economy hotels that can consistently deliver a high-quality and good value product will appeal very strongly to many astute travellers and can attract a wider market share, which is why the economy sector is set to play a major part in the wider hotel industry’s bounce back.”

Benjamin is optimistic about the revival of the hotel sector, which he says could get back to 2019 levels by 2023 if consumer certainty returns and vaccination programmes continue successfully.

•  www.agohotels.co.uk