Luxury hotels dropping their stars

Hotel News - 27/08/2009

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The US parent company of luxury hotel brands St Regis and W, Starwood Hotels & Resorts, has said that it will allow some of its properties to reduce service levels, and correspondingly, their number of stars, until the accommodation industry begins to see recover from the recession, according to comments by K C Kavanagh, a hotel group spokesperson.

Hilton Hotels and InterContinental Hotels Group have already reduced the star rating at some of their locations.

Stephen Bollenbach, the retired chief executive of Hilton Hotels, commented: “Maintaining stars requires enormous capital investment,” adding: “Ratings aren’t based on making good returns on your investment.”

As the global economic downturn has led to a decline in both the leisure and business travel sectors, luxury hotel operators have struggled to attract guests. This has meant lower room rates in some cases for high-end business and leisure travelers. What it may start to mean is the loss of some traditional higher-end amenities, including complimentary newspapers, welcome gifts, room flowers and 24-hour room service.

Hotel operators are finding that they need to reduce these types of services in order to cut costs. For the year through 31 July, occupancy rates at luxury hotels around the world dropped to 57 per cent, from 71 per cent for the same period in 2008.

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