50 per cent of US hotels forced to close without further relief

US: A survey of American Hotel & Lodging Association (AHLA) members shows that 71 per cent of hoteliers won’t survive the next six months given current and projected travel demand without further federal assistance.

The survey comprised 1,200 hotel owners, operators and employees conducted between November 10-13.

Findings revealed that 77 per cent of hotels will be forced to lay off more workers, and that more than one-third of hotels will be facing bankruptcy or forced to sell by the end of 2020 without additional relief from Congress. This includes a second PPP loan (Paycheck Protection Program), or an expansion of the Main Street Lending programme.

One-third (34 per cent) reported that they can only last between one to three months under the current projected revenue and occupancy levels.

82 per cent of hotel owners say they have been unable to obtain additional debt relief such as forbearance from their lenders, and 59 per cent said they are in danger of foreclosure by their commercial real estate debt lenders.

Overall, 52 per cent of respondents state their hotels will close without additional aid.

Chip Rogers, president and CEO of AHLA, said: “Every hour Congress doesn’t act, hotels lose 400 jobs. As devastated industries like ours desperately wait for Congress to come together to pass another round of COVID-19 relief legislation, hotels continue to face record devastation. Without action from Congress, half of U.S. hotels could close with massive layoffs in the next six months.

“With a significant drop in travel demand and seven in 10 Americans not expected to travel over the holidays, hotels will face a difficult winter,” he continued. “We need Congress to prioritise the industries and employees most affected by the crisis. A relief bill would be a critical lifeline for our industry to help us retain and rehire the people who power our industry, our communities and our economy.”

According to STR, nationwide hotel occupancy was 44.2 per cent for the week ending November 7 compared to 68.2 per cent the same week last. year. Occupancy in urban markets is just 34.6 per cent, down from 79.6 per cent one year ago.

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