As an avid Seinfeld watcher, I always maintain just about every situation in life can be related to a past episode of the 90’s sitcom. In fact, I often find myself quoting a particular episode to drive home the point. One of my favorites is when the down on his luck George Costanza insists that his goal in life is to become “hopeless” as he laments to best friend Jerry that “hope is killing me.”
So what does this have to do with hospitality? As we enter the holiday season and conclude one of the toughest years in recent memory for the lodging industry all is not lost. Yes, for those of you not named Costanza there is hope.
For starters, the approval of not one, but two vaccines, within the past few weeks means there should finally be an end game with this virus. There’s plenty of debate about how long it will take to be distributed to the masses but I think we can all agree that at least by next summer travel should be on just about everyone’s agenda. Pent-up demand for travel figures to skew the numbers in favor of hotels in the second half of the year.
In fact, immediately following the announcement of the first vaccine being approved many companies reported a spike in hotel bookings for the second half of the year. As further proof CBRE upped its expectations for the industry next year in the second half. According to the recently released Q3 2020 edition of Hotel Horizons®, CBRE Hotels Research is forecasting an average national occupancy level of 44.4 percent during the first half of 2021 with an increase to 55.7 percent during the year’s second half. It may not be what we’re used to as an industry, but it’s a far cry from the roughly 40 percent occupancy of the pandemic.
What took place in Washington, DC earlier this week offered more reason for hope when a second stimulus package was approved by Congress. In addition to another round of the Paycheck Protection Program for small businesses, the package also has provisions for loan extensions and debt relief. It will still be a while before this money is seen by hoteliers and for some it may be too little too late, but at least there is some relief in sight.
The industry—with the help of powerful trade associations like AH&LA (American Hotel & Lodging Association) and AAHOA (Asian American Hotel Owners Association)—rallied together to fight for a year-long extension for troubled debt restructuring classification, which was included in the final proposal. The legislation also includes more funding for SBA programs including 504, 7a and Economic Disaster Loans.
The lodging industry has been hit as hard as any business segment during the last 10 months, but there may be finally be some light at the end of the tunnel. As you prepare for the holiday season, we at Hotel Community Forum have plenty of hope for a better tomorrow and we wish you a happy and healthy 2021.