New Report Breaks Down Updated Impact of Coronavirus on Hotel Industry
The American Hotel & Lodging Association (AHLA) has released a report about the impact of the ongoing coronavirus outbreak on the hotel industry.
After six months of travel restrictions related to the COVID-19 pandemic, the AHLA shared sobering details regarding millions of employees still furloughed or laid off and travel demand lagging far behind normal levels.
The AHLA report found that four out of 10 hotel employees are still not working and 65 percent of hotels remain at or below 50 percent occupancy, which is below the threshold at which most properties can break even and pay debt.
“While hotels have seen an uptick in demand during the summer compared to where we were in April, occupancy rates are nowhere near where they were a year ago,” AHLA president Chip Rogers said. “Thousands of hotels can’t afford to pay their mortgages and are facing the possibility of foreclosure and closing their doors permanently.”
“Our industry is in crisis. Thousands of hotels are in jeopardy of closing forever, and that will have a ripple effect throughout our communities for years to come,” Rogers continued. “We need help urgently to keep hotels open so that our industry and our employees can survive and recover from this public health crisis.”
In addition, consumer travel remains at an all-time low, with only 33 percent of Americans reporting they have stayed overnight for a leisure vacation since March and just 38 percent saying they are likely to travel by the end of the year.
Urban hotels are also suffering the most and facing collapse with cripplingly low occupancies of 38 percent, with struggling properties resulting in massive job loss and dramatically reducing state and local tax revenue for 2020 and beyond.