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- The testing market environment could result in distressed opportunities that will make great entry points into the market.
- Many investors are on the lookout for such distressed assets, and therefore opportunities could prove scarce.
- The trend of shifting toward management contracts appears inevitable and will accelerate as hotel owners run out of options.
- Banks may become tougher when dealing with existing loans to hotels, possibly leading to more distressed assets.
- In the long run, Japan’s hotel market remains promising, and its famously high standards of public health will be an attractive factor as a new era of tourism is ushered in.
- Multiple upcoming positives for the hospitality industry include the roll-out of vaccines, a large "Go To" travel stimulus, significantly lower supply and pent-up demand for travel.
Distressed markets and credit markets emerging
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GRAPH 1 | Forbearance Period by Public and Private Banks at the end of December, 2020
The current difficult circumstances serve as a strong catalyst for the emergence of new trends and distressed opportunities. There are numerous keen investors on the lookout for such distressed assets, and therefore opportunities are unlikely to be as abundant as one might hope.
Savills Research & Consultancy