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Silver linings amid the gloom for tourism

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Health and safety a key attraction for Bermuda

by Jonathan Kent

Tourism faces a long and rocky road back to normality. A sector important for the jobs it provides and supports, and the foreign currency it brings in, was chopped off at the knees with the three-month airport closure and the sudden and complete loss of cruise ships.

Hotels and tourism-reliant businesses were shut down, thousands were laid off and many made redundant. Air arrivals have gradually picked up since the airport reopened in July, but a second wave of the virus in the US and Britain has caused the temporary suspension of the British Airways flight.

Cruise ships have been absent from April onwards, causing pain to the taxi and minibus drivers, retailers and tour operators who rely on them. In the last three quarters of 2019, Bermuda welcomed more than half a million cruise visitors, this year there have been none over the same period.

To say it’s been a tough year would be an understatement. But Glenn Jones, interim chief executive officer of the Bermuda Tourism Authority, says the mood in the industry has been lifted by Bermuda’s relative success in controlling the virus.

“Talking to them about where we are versus our competitors gives them a lot of optimism,” Mr Jones said. “Tourism is going to recover. This is a matter of how long does it take and how many tourism businesses can sustain themselves for that length of time.

“Our tourism recovery started in July and hasn’t regressed. Every month has been a positive step forward. Some of our competi- tors still haven’t opened up, or have opened up and had to shut down again.

“The recovery will still be longer than 12 months, for sure, but I think we’re going to get to a period that feels like recovery much faster than our competitors. And I hope that means we will lose a lot fewer businesses along the way.”

Based on what we know today, Mr Jones said a full recovery was unlikely before 2022, although much could change in the mean- time.

The BTA interim CEO said Bermuda’s health and safety record is a “differentiator” that leads the conversation with travellers, and which had produced spin-off benefits already, particularly in sports tourism as organisers seek safe venues.

In October the island hosted sailing events, the Bermuda Gold Cup and a World Match Racing Tour event, rescued by coming to Ber- muda. The Bermuda Championship was the first PGA Tour event to welcome spectators since the onset of the pandemic. And then there was the bonus of the World Tens Series rugby event.

“We were not even on their radar,” Mr Jones said. “We spoke to an organiser who said they had basically searched every con- tinent to find a place where they could hold the event. Bermuda was one of the few places where it was possible to do it safely, so they came here. They had a very good experience and they’re already talking to us about poten- tially coming back next year.”

Among next year’s sporting events will be the World Triathlon Series season-ending event in October and a potential spring US Tennis Foundation event. Also, confirmed only this week, is SailGP’s season-starting in April. The event will feature the same 50ft catamarans used in the 35th America’s Cup in Bermuda.

Eight teams – Australia, Denmark, France, Great Britain, Japan, New Zealand, Spain and the United States – will stay on the island for a four-week training camp ahead of the April 24-25 races on the Great Sound in the Bermuda Grand Prix presented by Hamilton Princess.

SailGP will be a huge draw to the big-spending superyacht crowd, a top BTA target. Mr Jones said: “We know this group is attracted to events and when they come, they stay for weeks longer – we saw this during the America’s Cup. This is a thrilling opportunity that not only offers Bermuda significant eco- nomic stimulus and international exposure outside the summer months, but also presents local business opportunities and community engagement benefits for our young people.”

Airlift, crucial to tourism’s success, has gradually been recovering since the airport reopened. Flights to Bermuda in July had only 10 per cent of the seats available for the same month in 2019, 20 per cent in August, 23 per cent in September and 33 per cent in October.

“Having that steady increase is giving us a steady pathway to recovery,” he said. Howev- er, Mr Jones is concerned by the prospects for winter airlift, as a result of the suspension of the BA flight and US airlines focusing on only the most popular routes.

At the end of March next year, BA will switch to Heathrow from Gatwick for its Lon- don-Bermuda service, something that would improve links to Europe, Mr Jones said.

Hotel room inventory will also influence airlift in the year to come. In April, the new St Regis Hotel in St George’s is due to open, the same month as the Rosedon reopens its doors. The new Bermudiana Beach Resort will open in July. Elbow Beach is expected to reopen, but the date has not been determined.

This activity will help to offset the more than 600 rooms that have been lost from the closure of the Fairmont Southampton, the island’s largest hotel, for a $100 million overhaul.

Mr Jones has mixed emotions about that, sad at the hundreds of workers impacted, concerned about the impact on airlift, but excited by the prospect of the refurbished hotel reopening in 2022.

“It’s the number one groups and con- ventions hotel,” Mr Jones said. “Perhaps the best time to take a pause is when groups and conventions are taking a pause. For that to be coming back online in April 2022, around the time the conventions season restarts, would actually be tremendous. Those planners look for new places to go.”

Another consequence of the closure is that smaller properties become more competitive in the absence of the Fairmont. “If you are Cambridge Beaches, The Reefs, or Newstead, the fact that you aren’t, at this moment, com- peting with the Fairmont Southampton, puts you in a stronger position than if you were,” Mr Jones said.

With regard to cruise ships, Mr Jones said the BTA has been working with health offi- cials to work out what the Bermuda standard will be for arriving passengers and he wants the island to remain ahead of the curve. “We should sort out with stakeholders like the Government and Wedco how we should open safely. If we do that now and get finished within the next 60 or 90 days, it puts us in the driver’s seat to tell the cruise industry, this is how Bermuda is going to do it safely, can you meet this standard?”

April 1 “feels right” as a potential re- sumption date, he added. Much depends on adherence to the framework developed by the Centres for Disease Control and Prevention in the US, under which cruise lines will eventually be able to resume passenger voyages with strict health protocols.

Inspiring residents to take “staycations” was part of the BTA’s “inside-out” marketing strategy to help hotels stay afloat and get their staff back to work.

“The hoteliers tell us that the staycations have been way stronger than they projected when deciding to reopen,” Mr Jones said. “There have been weekends when our hotels have been sold out, with the combination of people doing staycations and visitors.” The Work From Bermuda certificate, al- lowing international remote workers to work from Bermuda for a year has been a boon to tourism, in more ways than one.

Mr Jones said: “We believe this group spends a lot in the tourism economy, more so than the typical resident. They’re more likely to book a jet ski, take a boat trip, play golf and eat out.

“It’s also been the best publicity generator for Bermuda this year, with stories talking about the Bermuda lifestyle that is attractive to visitors. By our count, we’ve seen $2.6 mil- lion in combined media value just from media organisations talking about the Work From Bermuda certificate and more than a billion impressions.”

Vacation rentals have benefited from digi- tal nomads. Hotels have introduced extended stay pricing for this market, while electric car firms are looking at month-long and quarterly rentals.

Traditionally, the leisure travel had been largely a volume play, based on numbers of visitors, Mr Jones said. “Maybe the play now is how long can we get a visitor to stay and how much can we get them to spend per day while they’re here.”

 

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