- Security firms for the wealthy had to pivot on a dime when travel halted last year.
- Now they are getting ready for the return of luxury vacations by hiring above pre-pandemic levels.
- Security execs explain how they are prepping for a travel surge and the destinations of the rich.
- See more stories on Insider’s business page.
In March last year, CEO Dale Buckner watched as countries closed their borders in response to the pandemic. The founder of Global Guardian, a security firm, realized that all travel-protection business for his corporate and wealthy clients was going to dry up. On March 21, he told his employees that 40% of revenue would disappear overnight.
In the next four weeks, the firm pivoted from mostly international work to domestic and shifted its focus from on-the-ground security to surveillance and cybersecurity to make up for the revenue loss. Now Buckner is preparing for the return of travel assignments as more clients get vaccinated and countries reopen and lift cumbersome quarantine requirements. Travel volume is already back to 46% of pre-pandemic levels and he anticipates that percentage to hold steady this summer and surge to 80 to 90% once kids go back to school in September, he said.
“There is now a demand signal from our client base that has said the minute that jet can get into Mexico, Switzerland, Dubai, without it without being overly dramatic and bureaucratic, we’re going,” Buckner, a former special-forces officer, told Insider.
Insider spoke with executives at seven security firms that cater to wealthy families and blue-chip corporations about how they were preparing for the summer travel surge, from hiring staff in excess of pre-pandemic head count to requiring vaccinations for bodyguards and security drivers.
The most cited dream destination for the jet-set crowd was Paris, which has been closed to foreign travelers for more than a year, but Buckner said many clients were planning extravagant trips all over the globe.
“Our high-net-worth families want to execute parts of their bucket list because during COVID, they couldn’t get into Fiji or climb Everest or get to Machu Picchu,” he said. “People are thinking they lost a year of their lives, and in the back of their minds, they’re thinking, ‘What if this happens again?'”
‘The tap instantly turned off’
As corporate and leisure travel came to a grinding halt, medical evacuations and repatriation trips became the bulk of firms’ travel work. That said, some wealthy families never stopped traveling, said Buckner, who had several Northeast clients traveling to Costa Rica, Mexico, and the Dominican Republic this past winter. And a pandemic didn’t stop moneyed clients from expecting white-glove treatment.
“We did a medical evacuation out of St. Barts to Los Angeles for a wealthy family that came down with COVID,” Buckner said. “Their No. 1 concerns were whether we would have Fiji water in the airplane for them and whether we could provide an IV with a medic to them.”
Ground security services come with steep costs. At Global Guardian, one bodyguard costs between $750 and $1800 for 12 hours of protection. Air ambulance services, without enrolling in the firm’s membership program beforehand, can cost up to tens of thousands of dollars. For example, an evacuation from Bali to the Mayo Clinic in Minnesota could cost an estimated $125,000.
Other families booked entire boutique hotels and paid for staff to bubble up, Brian Leek, the managing director of the security firm Crisis24, said. But most clients stayed at home. Crisis24 used to book 400 security assignments a month, and the number went down to three by the end of March 2020, he said. The assignments went from glamorous yacht trips to arduous repatriation jobs, such as driving one client from Romania to London.
“The tap instantly turned off,” Leek told Insider.
Paris is a top destination for the superrich
Clients started asking about traveling abroad in the winter and have picked up this spring, most firm executives said. Inquiries are at 75% of the pre-pandemic level for International SOS, Jeremy Prout, the firm’s director of security solutions, said. Most clients are looking to travel within their regions to countries that have similar COVID-19 case counts to their own, he said.
Unsurprisingly, many of the top destinations for wealthy Americans are countries that have fewer restrictions on foreign travelers, such as Mexico, Costa Rica, and Ecuador. Clients with superyachts are planning weeks-long stays in the Caribbean. Middle Eastern clients are booking trips to the US in June and July.
Joe Funk, a senior vice president at TorchStone, started getting calls in November and December about putting trips on the firm’s radar, mostly to the Caribbean and Latin America. Since the beginning of the new year, wealthy Americans have expressed a lot of interest in going to Europe, but inquiries haven’t translated into a large increase in bookings.
“People are still a little bit reluctant to pull the trigger,” said Funk, who was in the Secret Service under Presidents George H.W. Bush and Bill Clinton. “We’re not nearly seeing the uptick that we would normally see for summer travel throughout Europe.”
The UK, France, Germany, and Amsterdam are top of mind for clients, but the travel restrictions give many pause. Rich clients are especially eager to go to Paris and the south of France, but France currently requires all travelers from outside the EU to quarantine for seven days. France is allowing entry to foreign tourists starting on June 9 if they have a health pass, but it is unclear how to obtain one.
“Europe is the dream, but there are a lot of restrictions on travel to Europe,” Todd Keil, an associate managing director at Kroll, said. “It’s not a cost issue, but it’s inconvenient.”
But restless clients are monitoring travel requirements, and once burdensome restrictions lift, the demand could surge very quickly.
“I think the minute Paris opens, there will be a run on Paris,” Buckner said.
Client demand lists are expected to grow
Dealing with countries’ changing border policies is a new problem on the laundry list of tasks for security firms, such as providing the right kind of bottled water and remembering which clients hate being called “sir.” Firms have to be more flexible than ever when their clients or staff are refused entry to a foreign country.
“We’ve had clients who have been denied entry into Austria, Amsterdam, France, and Asia,” Funk said. “If you have a client who is departing London heading to France, and he gets denied entry — well, you still need to maintain some sort of security coverage for him.”
“Clients’ expectations, in my opinion, are more demanding now, to be truthful,” Leek said. “Hygiene is a very big concern.” For instance, now many clients expect security staff to sanitize hotel rooms and seal the door before they arrive.
Now clients have to be separated from any staff who aren’t vaccinated, William Daly, a partner at Control Risks, said. Buckner’s firm is going one step further and requiring any staff that work in person with clients to get vaccinated.
How firms are staffing up for a surge in travel
Most executives were planning to hire more staff to bring head count above pre-pandemic levels, particularly operations-center employees who handle bookings and coordinate assignments, in anticipation of more client travel this summer.
Daly said assignments hadn’t gone up dramatically, but Control Risks is about to launch an online portal for bookings to expedite the process and hire more security drivers, agents, and other ground-protection professionals.
“We have a great bench of these types of individuals,” a former FBI officer told Insider, but it’s looking to expand because it’s expecting pent-up travel demand to surge.
“If we get a surge period, we want to make sure that we’re able to kind of support those clients who reach out to us,” they added.
London’s Westminster Security is testing its bodyguards for COVID-19 twice a week so they are ready at a moment’s notice for their clients, whether they want to go to take their yacht to Mykonos, Greece, or shop in Paris, which is particularly popular among Middle Eastern clients.
“Our guards are ready to go when they are,” John Moore, a managing director, said.
‘There’s definitely pent-up demand, and at some point, that dam is going to burst’
Though Leek is hiring more staff, particularly administrative staff that coordinate bookings, to prepare for a wave, he is keeping his expectations tempered.
“June is going to be a test phase,” he said, adding that he could see travel picking up in “August before the end of the summer holidays for the children.”
Prout thinks that domestic travel for the wealthy crowd will recover over the winter holidays in 2021, he said, but there is no telling for international travel because of uneven vaccine rollouts and resurgences of the virus.
“My crystal ball has been so wrong over the past 14 months like everyone else’s,” the former Marine officer said.
Keil is similarly cautious but cautiously optimistic.
“I think people are still a bit wary about extensive travel,” he said. “But there’s definitely pent-up demand, and at some point, that dam is going to burst.”
Leave a Reply
Leave a Reply
This site uses Akismet to reduce spam. Learn how your comment data is processed.
