F1 return: Hotels 'delighted', experts welcome Singapore's 'readiness' to move forward post-pandemic
SINGAPORE: The renewed contract for Singapore to host the Formula 1 Grand Prix for another seven years will be a driving force for major changes in a post-pandemic landscape, from a tourism boost to jobs creation, said industry experts.
The night race will return to the streets of Marina Bay in September after an absence of two years due to the COVID-19 pandemic, the Singapore Tourism Board announced on Jan 27.
The Singapore Grand Prix was cancelled in 2020 and 2021 after it was scheduled as part of the F1 race calendar.
The event is "catalytic" as attention from the rest of the world will directly benefit the whole tourism industry, said Dr Kevin Cheong, chairman of the Association of Singapore Attractions (ASA).
"(With) the number of eyeballs globally glued to the F1 race, Singapore's seven-year contract locks both Singapore and the Grand Prix as the premier must-see, must-experience and must-visit race in Southeast Asia."
Dr Cheong added that the timing of the F1 race in September is "very strategic".
"F1 will kickstart the year-end holiday season, with the Indian travel season in October/November, then winter holidays in December, and finally the Lunar New Year holidays in January/February," he said.
CAPTURING F1 CUSTOMERS
With the F1 Grand Prix targeting the "high-yield, luxury traveller" and the corporate entertainment customer, the renewed contract puts Singapore's destination positioning at the "highest possible target market", added Dr Cheong.
"Indirectly, the corporate entertainment visitors are important F1 visitors. They are likely to be high net-worth individuals and corporate head honchos from the region. They are a very important market for Singapore – as visitors, investors and business stakeholders."
As a result, Dr Cheong believes that sectors outside the tourism ecosystem, such as the high-end luxury retail and food and beverage sectors, would also be positively impacted.
To capture the crowd, attractions can start to plan "exclusive experiences for the F1 visitor" during pre- and post-race periods, as well as make plans to be a venue for F1 parties, he suggested.
"(The ASA) is exploring how F1 parties and entertainment can be more nature-based and outside the city. These activities will add value, richness and depth to visitors' experience in Singapore."
HOTELS "DELIGHTED" TO WELCOME BACK F1
Some hotels located near the circuit have also expressed delight about the return of the night race, and are gearing up to welcoming more customers.
“Since Mandarin Oriental, Singapore is located at the heart of the Marina Bay Street Circuit, we are delighted to hear of the resumption of Formula 1 race in Singapore,” said the hotel's general manager Philipp C Knuepfer.
"Because that would enable us to offer advantageous views of the race to international and local spectators eager to immerse themselves in this adrenaline-packed event."
Over at Pan Pacific Hotels Group, the hospitality company is "overjoyed" to learn that the event has been extended for another seven years.
The company now has two "trackside hotels" offering views of the race, said its chief sales and marketing officer Cinn Tan. Besides its flagship Pan Pacific Singapore hotel, its new luxury hotel Parkroyal Collection Marina Bay will offer "prime balcony views" of the event.
The return of the race also brings opportunities for collaboration with other companies, added Ms Tan.
"Pan Pacific Singapore has been an official caterer and host of various high-profile groups in past years, and we anticipate more collaborations, hosted groups and guests with the return of the night race."
The hotel group has been in discussions with partners in preparation for the return of the race, with marketing promotions and members’ rates on its website.
"Closer to the date, we will develop packages to cater to fans and guests who are eager to catch the momentous return of the event live from our hotels," said Ms Tan.
IMPACT FELT BEYOND TOURISM SECTOR
With the renewed contract keeping Singapore in the F1 Grand Prix calendar until 2028, the event will create "vibrancy" in a tourism sector that has been badly hit by the pandemic, said Dr Michael Chiam, tourism analyst and deputy director at Ngee Ann Polytechnic's School of Business and Accountancy.
While these financial benefits that will accrue to Singapore's economy and hospitality industry will be "initially small", the "fundamental positive impacts" will remain, added Mr Ben Cassim, manager for Temasek Polytechnic's Diploma in Hospitality & Tourism Management.
These benefits include an inflow of tourist receipts and demand for hotel rooms during the race period, particularly for hotels within the vicinity of the race circuit, he said.
But the F1 Grand Prix's ripple effects will also be felt by other sectors outside tourism.
The event will create businesses for local enterprises and jobs for locals, from project-based contracts to part-time work, Dr Chiam and Mr Cassim pointed out.
They highlighted that the F1 race will also benefit the F&B, attraction, retail and transport sectors.
"The other potential beneficiaries include ... (the) medical (sector). More significant would be the business networking opportunities that the event will provide to the various industries and sectors that operate in Singapore," said Mr Cassim.
On the other hand, Mr James Walton, the sports business group leader at Deloitte Southeast Asia, noted that the length of the renewed contract "throws up some interesting new partners" outside those industries that have traditionally benefited from the event.
"The seven-year duration is in part because of the desire to transform the event to be more sustainable and to be a sandbox for innovation," he said.
"With a three- or five-year contract, companies may have been reluctant to invest to develop new technologies. But with a seven-year runway, we will see companies partnering with the organisers and the Government to come up with more efficient lighting solutions, biodegradable and recyclable options for trackside waste, and alternatives to single-use plastics."
Mr Walton pointed out that there is a "multiplier effect" in the local economy, as "usually 90 per cent of race organisation is sub-contracted to Singapore-based firms, and around 30,000 people get short-term employment before, during and after the event".
However, he said that economic impact cannot be estimated yet for 2022, until much closer to the event.
"Local attendance will also depend on the track capacity, due to safe-distancing, and the off-track entertainment options," he said.
"The best-case scenario for 2022 will be to break even for Singapore. But ultimately we expect to return back to more positive numbers from 2023 onwards, if the local and global approach to the COVID-19 situation continues to move forward."
SINGAPORE "OPEN AND SAFE" AGAIN
At the moment, it’s undeniable that the renewal of the Singapore Grand Prix contract is a "huge" statement, said Mr Walton.
It indicates Singapore's "readiness to move forward post-pandemic and attempt to return to hosting international mass spectator events".
"In terms of what it could do to boost the tourism and F&B sectors in the coming months, but also in terms of cementing our place as one of only two Asian F1 Grand Prixes for the coming year and perhaps longer as the calendar fills up," he added.
The flagship event is also an "affirmation" of the event industry’s importance to Singapore’s economic growth, especially in light of COVID-19’s disastrous impact on the industry, added Mr Cassim.
"Given the extended seven-year renewal agreement, this does bring a measure of hope to people living in Singapore in these times of uncertainty. Hope is one of the primary motivators that keep societies moving forward, so the impact here is not to be discounted."
But there are still many things up in the air, said Mr Walton.
"What will the concerts and off-track events look like in a safe-distancing future? By the same token, how to handle safe-distancing in seating areas like the pit lane? What course will the track take given the new NS Square construction? How many tourists can we expect to bring in and what will the vaccinated travel regime look like? How many spectators can realistically attend for the next one to two years, given all of the above?"
Despite the many factors that need to be worked through over the next eight months, Mr Walton said the renewed contract was a "very positive step" and provided a platform to work from.
Ultimately, we need flagship events to encourage people to travel, he added.
"Sports fans have been chomping at the bit for live events in Asia, having seen the return to stadiums and tracks in the US and Europe in recent months.
"But besides those F1 ‘petrolheads’, (the F1 race) can also serve as a callout to tourists around the world – that Singapore is open and safe – as the world opens up again."