Hotel casino workers take employers to court
A Reno, Nevada-based culinary union representing 60,000 workers including F&B, housekeeping and bell staff filed a lawsuit against three Las Vegas Strip properties charging them with failing to protect their employees from the coronavirus. The lawsuit was announced in a press conference Monday that featured stories from employees describing returning to work after the shutdown to face long hours working short-staffed in contact with customers not wearing masks. MGM Resorts International has responded to that lawsuit, saying, “Nothing is more important to us than the safety of everyone inside of our properties.”
Miami Fontainebleau sues union after virus layoffs
Miami’s Fontainebleau Hotel filed a lawsuit in Florida federal court accusing a health fund covering its unionized workforce of improperly demanding millions of dollars in contributions on behalf of workers laid off in the wake of the COVID-19 health crisis. The hotel says the fund and the union attempted to collect as much as US$5.5 million in health plan contributions tied to the 1,077 Unite Here workers laid off by the hotel in March. Fontainebleau says this demand is “contrary to the requirements” of its collective bargaining agreement with the union.
Oyo suspends some guarantees to hotel partners
India-based Oyo suspended contracts with more than 250 hotel owners across the country, as it looks to renegotiate fixed payment agreements after revenues took a hit due to a nationwide lockdown, said multiple people aware of the development. The SoftBank-backed startup has terminated minimum business guarantee agreements, a fixed amount payable to property owners on a monthly basis. In its communication, Oyo instead offered new contracts on a revenue share basis, nullifying fixed payouts that were earlier agreed on, said at least half a dozen Oyo Townhouse property owners.
Big hotel owners stand to gain from U.S. relief
The biggest beneficiaries of potential U.S. government debt relief assistance could be large real estate owners affiliated with properties that owe troubled hotel debt, according to an analysis by hotel union Unite Here International. The hotel owner with the most money in these troubled commercial mortgage-backed-securities loans is Monty Bennett. The Dallas businessman is affiliated with companies including Ashford Hospitality and Braemar Hotels & Resorts that had loans valued at nearly US$2.3 billion with special servicers.
IHG reopening but expects 75% RevPAR fall
InterContinental Hotels Group expects comparable revenue per available room to fall 75% for the second quarter, with an improvement toward the end of the period driven by the Americas and greater China regions. IHG said only 10% of its global estate is currently still closed after the coronavirus pandemic caused an unprecedented drop in demand and forced it to shut down most of its hotels earlier this year. In the Americas region, around 5% are closed; these are predominantly managed luxury and upscale hotels, and those outside of the US. Good progress has been made across the EMEAA (Europe, the Middle East and Africa) region as government-mandated hotel closures have eased; around 30% currently remain closed. In Greater China, just 1% are closed.
Why COVID will increase Google’s dominance
Unlike past downturns that have strengthened the OTAs’ position, COVID-19 has forced virtually all travel to stop, ultimately hurting OTAs’ marketing spend and clout of pre-pandemic, according to an analysis from hospitality e-commerce company Fornova. This means that when travelers are searching online, Google’s travel products dominate the results. Google was already hot on the heels of the OTAs before the pandemic, the analysis continues. In 2018 it passed Kayak as a source of traffic to airlines and this year’s unprecedented events and the release of new Google products for the hospitality sector look set to accelerate those gains.