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Bahamas wants 2,000 more hotel rooms for ‘good footing’

The Bahamas’ prospects for continued tourism growth depend on bringing 2,000 hotel rooms, or 15 percent of its total pre-COVID inventory, back on line swiftly with the industry at “maximum capacity”.

Robert Sands, the Bahamas Hotel and Tourism Association’s (BHTA) president yesterday told Tribune Business that the country must “address capacity” if its largest industry is to maintain the post-pandemic growth momentum, adding: “We have to get those rooms out of order back in order.”

Apart from the loss of the now-demolished Melia Nassau Beach Resort’s 694 rooms, and the closure of Atlantis’ Beach Towers property for redevelopment into the Somewhere Else concept the BHTA president said a “significant” amount of inventory has also been lost in Grand Bahama. That largely stems from the closure of two of the three properties that form the Grand Lucayan complex.

Voicing optimism that hotel developers and operators are working to “reverse” these trends, Mr Sands told this newspaper that The Bahamas has withstood earlier negative international media coverage of its crime woes and US/Canadian travel warnings with bookings for the upcoming Easter period and winter tourism peak “meeting or exceeding the expectations” of many resorts.

While acknowledging that the negative perceptions created by such coverage never completely dissipate, he added that he is confident The Bahamas “can trump” any fall-out by providing visitors with such high-quality experiences that they will continue to recommend the destination to family and friends.

And, asserting that tourism’s benefits are “not Nassau-centric”, Mr Sands said the two days he and other BHTA executives spent in the company of Eleuthera resort executives showed that “they are very bullish” on current and near-term business prospects for the sector.

Kerry Fountain, the Bahamas Out Island Promotion Board’s (BOIPB) executive director, yesterday told Tribune Business that room nights sold by member properties during the early part of 2024 were 7 percent up on the same period last year although they have yet to match pre-COVID performance.

Ben Simmons, proprietor of the Ocean View and The Other Side proper- ties on Harbour Island and mainland Eleuthera, said his occupancy numbers for March and April 2024 are “running neck and neck” with the same months for 2023. “It means the post- COVID boom is not a bubble,” he told this news- paper, as occupancies for March stand at 95.5 per- cent compared to the prior year’s 95.8 percent.

However, Mr Sands said increased room inventory – both among hotels and vacation rentals – remains critical to maintaining tourism and the wider economy’s momentum by providing sufficient accommodation to meet the still-surging demand for a Bahamas vacation.

While New Providence “will be seeing in earnest this year” the impact from the British Colonial’s re-opening, and “can look forward to an entire year of that additional capacity” with some 290 rooms returned to operation, he added that more was required to further cement the country’s growth prospects.

“I would say that we will be at maximum capacity,” Mr Sands told Tribune Business of the hotel industry’s anticipated Easter weekend. “We have to put this in the context of the amount of rooms we have available. The only way we’re going to grow our tourism industry for the future is we need increased capacity. I believe everybody knows that.”

Explaining that the solution is not simply just building more hotels, the BHTA president called for an “holistic” solution “because a lot of infrastructure has to go into place” – especially increased airlift and upgraded Family Island airports – to support greater room inventory and visitor demand.

Acknowledging that this was occurring, although “possibly slower” than desired when it came to Family Island airport transformation, Mr Sands said: “The holistic development of the industry is beginning to take shape. But we have to address capacity. We have to get those rooms out of order back in order, and a significant number of them are in the Family Islands, especially Grand Bahama.

“Not all of it is new build, but a lot of it is getting that inventory capacity which, for multiple reasons – whether for Dorian, recession or COVID – back in line to put us back on a good footing. I would say if we were to add it all up in totality, compared to pre-COVID, we may be down 2,000 hotel rooms, which is 15 percent of inventory. I am confident that a number of developers and operators are working to reverse that trend.”

Mr Sands acknowledged that small Family Island resorts are “adding rooms on a continual basis’, while vacation rentals such as Airbnb – despite having “stumbled to begin the year” due to the crime coverage fall-out – have also “rebounded”.

Disclosing that The Bahamas has regained its momentum following the temporary international media interruption, the BHTA president added: “Booking pace, and bookings, for Easter are very strong, meeting or exceeding expectations in some cases. March has always traditionally been the strongest month of the year, and I think a number of hotels are exceeding those projections.

“The Bahamas brand remains strong and vibrant, and it has withstood some of the headwinds it received earlier in the year. The first quarter was always going to be very strong, and we continue to work on the second quarter for its growth. It’s trending in the right direction.

“I’m hearing that not only from hoteliers on New Providence but in areas like Abaco, Eleuthera, Exuma and Andros, which are some of the fastest growing islands in terms of tourist activity. I can tell you having just spent two days visiting with hoteliers [on Eleuthera] they are very bullish about business they are seeing currently until they close their doors towards the latter part of the year.”

Mr Sands said Bahamian resorts are continuing to enjoy increased visitor lengths of stay and higher average daily room rates (ADRs) but added that occupancy improvements are relatively small heading into Easter because many properties were already performing at a high level. He added that “revenue management and converting to the bottom line” has become more critical.

The BHTA president also asserted “there’s no question” that the resort industry is now exceeding pre-COVID numbers with stopover visitor arrivals at year-end 2023 exceeding 2019 comparatives. “We would have exceeded the 2019 position at the end of 2023,” Mr Sands said.

“We’re not seeing the deep valleys and hills that we’ve seen in years past. While there are still hills and valleys, they are not as distinct and pronounced as in years past. All of that will contribute to a year most hotel operators will be happy with. All of these things largely strengthen The Bahamas’ brand and generate the positive momentum and spend to the industry.”

By: Neil Hartnell, Tribune Business Editor