Financial Investment Modes and Strategic Readiness of Star-Rated Hotels in the COVID-19 Pandemic Environment in Kenya

Abstract

The hotel industry in general is a great investment option for generating income and building long-term wealth. The hospitality industry, especially in the developing world context, is fraught with risks that limit investment in the industry and these risks have been further compounded by the emergence of the COVID-19 global pandemic which, though under control, presently has put the levels of strategic readiness of the industry into question. This paper, therefore, explores the influence of financial investment modes on strategic readiness of star-rated hotels in Kenya in the COVID-19 context. The study was guided by the Modern Portfolio Theory and used a cross-sectional study design targeting star-rated hotels in Kenya from which 120 were selected using systematic random sampling. Using data collected through questionnaires and interview schedules, the study found that financial investment modes have a significant influence on strategic readiness of star-rated hotels in the COVID-19 pandemic environment in Kenya. Most hotels were working on a mix of financing instruments that will ensure financial sustainability even after the pandemic. The hotels' levels of readiness have an important impact on their financial instrumentation prospects. The study recommends that the star-rated hotels should also reposition themselves strategically in the investment market so as to enable them attract more investment from both the private sector and the public sector to enable them build more resilience in times of crisis.