‘Unprecedented lows’
Reflecting the continued impact of the COVID-19 pandemic, the U.S. hotel industry reported significant year-over-year declines in the three key performance metrics during the week of March 22-28, according to STR. “Occupancy continues to fall to unprecedented lows, with more than 75% of rooms empty around the nation last week,” said Jan Freitag, STR’s senior VP of lodging insights.??In comparison with the week of March 24-30, 2019, the industry recorded the following: Occupancy fell 67.5% to 22.6%; ADR fell 39.4% to US$79.92; ?RevPAR was down 80.3% to US$18.05. ??Aggregate data for the top 25 markets showed steeper declines in occupancy (-74.5% to 19.6%), ADR (-43.9% to US$89.71) and RevPAR (-85.7% to US$17.60).
More details:
• New Orleans, Louisiana, recorded the steepest decline in RevPAR (-92.8% to US$10.27), due primarily to the second-largest decreases in occupancy (-84.9% to 12.7%) and ADR (-52.3% to US$80.74)
• Oahu Island, Hawaii, experienced the steepest drop in occupancy (-86.4% to 10.5%)
• Miami/Hialeah, Florida, posted the largest decline in ADR (-57.9% to US$116.64)
• Occupancy in New York City was down 81.8% to 15.2%. In Seattle, Washington, occupancy dropped 76.6% to 18.5%
South Korean hotel company HTC goes under
South Korea-based Hospitality & Tourism Company (HTC), which runs over 30 hotel, resort and other hospitality locations in the country, became the first major company in the industry to go down under the fallout from coronavirus. A midsized operator since 1997, HTC last week filed for court protection after it failed to meet heavy debt obligation. Its revenue at heyday averaged US$16.4 million annually. According to the Korea Hotel Association, 44 major hotels across the country are estimated to have incurred losses of ?83.5 billion (US$68.3 million) from 110,000 cancellations of rooms as of March 11. The virus began spreading quickly in Korea after the Lunar New Year holiday that started January 24.
Trump D.C. sale on pause
The sale of the Trump International Hotel Washington, D.C. is on hold as the real estate industry reels due to the coronavirus pandemic. The Trump Organization announced plans to sell its D.C. property in October, but the market’s collapse in recent weeks has reached Trump’s firm, a company official confirmed to The Washington Post. Several of the company’s major properties in Florida and New Jersey have already closed as part of stay-at-home orders imposed by dozens of states.
Airbnb CEO offers apology, US$250M to hosts
Airbnb CEO Brian Chesky has apologized to travel hosts upset by the company’s cancellation refund policy, laying out areas of relief, including US$250 million to offset refunds. In a 15-minute video message that included more than 6,000 participants, Chesky said that the relief money would go towards bookings made on or before March 14. Hosts are eligible for 25% of what they would have received after a cancellation under the previous policy.
The risks of using hotel rooms as hospital beds
In a new report from insurance broker and risk management firm Marsh, the company discusses the use of hotel rooms to compensate for a lack of hospital beds to treat COVID-19 patients and others. According to the report, these types of nontraditional uses of hotel properties “can present significant risks and raise insurance questions that owners, risk professionals, and legal counsel must carefully consider.” The report goes on to recommend that hotel owners should seek to secure strong indemnification and insurance requirements, in addition to taking other precautionary measures.
Lima’s occupancy falls
As the impact of COVID-19 broadens in South America, Lima’s daily hotel occupancy fell to as low as 12.9% on March 19, according to preliminary data from STR. That occupancy level came one day after the Peruvian government imposed a nightly curfew to combat the spread of COVID-19. STR’s most recent data for March 22 showed that just 13 of 100 rooms on average were occupied in the city.
Get a room in Vegas in April?
Nevada’s 30-day casino shutdown is set to end April 16, and some Las Vegas properties already have plans to accept bookings the following day. Websites for Caesars Entertainment and Wynn Resorts on Tuesday had rooms available starting April 17. Las Vegas Sands rooms were available on April 20 as of Tuesday morning, but closures have since been extended through April 30. MGM Resorts International, Red Rock Resorts and Boyd Gaming websites don’t offer bookings until May 1. The exact opening dates for these properties are also still unclear.
More from the Las Vegas Review-Journal
Hotel and restaurant bankruptcies soar in Sweden
Record numbers of hotels and restaurants in Sweden went bankrupt in March as customers stayed at home to avoid spreading the coronavirus, figures from credit information firm UC showed Wednesday. Bankruptcies in the restaurant and hotel sector shot up 123% in March compared with the previous year.
Oyo furloughs most U.K. staff
India-based Oyo, the US$10 billion hotel booking startup, has furloughed the majority of its U.K. staff after the coronavirus pandemic led to a slowdown in bookings. Oyo told staff in an email this week that the “majority of roles” would be placed on furloughed leave for up to eight weeks. The company will take advantage of the recently announced government income support, which will pay 80% of staff wages up to £2,500 (US$3,093.) Staff are being furloughed due to “a sharp, recent downturn in our business as a result of the coronavirus outbreak across the globe,” management stated in an email.
Colorado icon furloughs 1,400 employees
The Broadmoor hotel in Colorado Springs has furloughed 1,411 employees, with the resort saying it expects to reopen in late May. The hotel also said it was “making arrangements for supplemental pay, health care coverage and other assistance (for employees) during this unprecedented situation.” According to the resort’s president Jack Damioli, the Broadmoor plans to recall all employees when it reopens.
Free training, education for industry workers: AHLA
In an effort to support the 8 million hotel industry employees affected by the coronavirus crisis, the American Hotel & Lodging Foundation, the charitable arm of the AHLA, will offer free resources to help industry employees continue their education. This includes:
• Free hospitality management online courses
• Professional development scholarships for AHLA certifications
• Continuing education online programs (English as a second language, GED and associate degree college courses)
The foundation has also underwritten funding to provide three online manager trainings at no cost to lodging employees in the U.S. These include supervisory skills builders; hospitality manager – leadership; and a certified hotel administrator review course. The courses are available April 1–30.
Elsewhere
CapitaLand names new CEO, Lodging: Kevin Goh is now CapitaLand’s CEO, Lodging. Goh is concurrently the CEO of The Ascott Ltd., an appointment he has held since 2018. Goh, who has been with CapitaLand Group since May 2007, has taken on various leadership positions in Ascott including chief operating officer, managing director of North Asia and regional general manager for East and South China.