The hotel industry needs additional help to stay afloat, and that help has been slow in coming. With the 2020 presidential election less than a month away, countless hotel owners worry they won’t survive the holidays without additional economic relief. The American Hotel & Lodging Association (AHLA) surveyed 1,000 hotel owners, operators, and employees at the beginning of September 2020 and the results show that the hotel industry remains on the brink of collapse. According to the AHLA report, 68% of hotels have less than half of their typical staff working full time, and without further economic assistance, 74% indicated they will have to lay off additional employees.
Highest CMBS Delinquency Rate on Record
The hotel industry is about to face a wave of hotel foreclosures as the delinquency rate on CMBS loans just hit an all-time high. According to Trepp, as of July 2020, 23.4% of loans were 30 or more days delinquent – the highest percentage on record. With nearly 1 out of every 4 hotel CMBS loans delinquent on payment; industry leaders sent Congress this urgent letter in August to urge them to pass the HOPE Act (Helping Open Properties Endeavor Act). The HOPE Act is bipartisan legislation intended to provide assistance to small businesses that operate in the ailing commercial real estate market. It would address the unique challenges of commercial real estate and provide commercial property owners the temporary liquidity they need to keep their doors open in exchange for a preferred equity interest in the property.
AHLA Spearheads Action and a COVID Coalition
President and CEO of AHLA – Chip Rogers – has been very vocal about his concern stating, “We are incredibly worried about the fall and what the drop in demand will mean for the industry and the millions of employees we have been unable to bring back. The job loss will be devastating to our industry, our communities, and the overall American economy. We need urgent, bipartisan action from Congress now.” As part of its ongoing effort to assist the industry, the AHLA created a grassroots action center called HotelsACT which helps hotel professionals contact government officials via email, phone and more. You do not need to be an AHLA member to participate.
The AHLA just spearheaded the formation of “COVID Relief Now,” a coalition of more than 230 public and private sector groups that is imploring Congress to not leave town for the 2020 elections without passing additional COVID economic relief. The group sent this letter to Congress on September 30th begging for emergency relief before adjourning for the election in order to prevent catastrophic economic harm. The group also released a “No Recess without Relief” ad this week. In addition to the AHLA, founding members of the “COVID Relief Now” coalition include the U.S. Travel Association, International Franchise Association, National Governors Association, National Restaurant Association and hundreds more.
What Can Hotel Owners Do?
Hotel owners can help the economic relief effort by being vocal and outspoken about the industry’s need for assistance. Contact your government officials often to tell them what you think. Share the COVID Relief Now ad, letter and initiatives with your social network. Do what you can to be heard and stay on top of events as they unfold so you are as informed as possible.