About 25% of Marriott hotels shuttered worldwide due to coronavirus
The hotel chain also anticipates more closures ahead, as well as diminishing revenue per room. The company doesn't think business will get better until governments have removed restrictions and the coronavirus spread has stabilized.
North American occupancy levels are at about 10%, and more than 870 hotels are temporarily closed (16%). Marriott is expecting to report that its March revenue per room fell 60% globally in March, roughly the same as in the U.S. alone (57%).
The company expects to report that in March revenue per available room decreased approximately 60% worldwide, reflecting declines of around 57% in North America.
Marriott is also doing its part to give back during the pandemic: It's donating $10 million in hotel stays for doctors and nurses. The company's efforts are focused on the areas of the country most affected by coronavirus, including New York and Newark, New Jersey; New Orleans; Detroit; Los Angeles; Las Vegas and Washington.
Across the U.S., about 80% of hotel rooms are empty.
Hotel occupancy, average daily rate and revenue per available room were down significantly year-over-year for the week of March 29 through April 4, per a new report from STR, a firm that analyzes hospitality industry data.
Compared with the week of March 31 to April 6 last year, hotel occupancy was down nearly 70%, with only 21.6% rooms filled.
"Data worsened a bit from last week, and certain patterns were extended around occupancy," Jan Freitag, STR’s senior VP of lodging insights, said in a statement.
Half of the hotels in the U.S. could shutter amid the ongoing coronavirus pandemic, Chip Rogers, president and CEO of the American Hotel & Lodging Association told USA TODAY last month.
"If something doesn't happen quickly, since occupancy is trending toward zero, you're going to see thousands of hotels go out of business," Rogers said. While many will close and reopen at some point in the future, others won't.
If occupancy dips below 25% to 30%, instead of trying to hold on to a skeleton staff, hotels would save money by closing their doors.
The $2.2 trillion stimulus package signed into law last month by President Donald Trump is aimed at getting the economy back on its feet as it deals with the coronavirus shutdowns. Per the package, hotels and other travel providers will have to compete from loans from a $500 billion fund.
The American Hotel & Lodging Association sent a letter to Congress urging them to update the CARES Act on top of the funding increase. The organization also wrote a letter to the Federal Reserve and Treasury, hoping to stop the foreclosure of thousands of hotel properties.
It's yet to be seen whether the stimulus is enough to get travel businesses back to any semblance of where they stood before the crisis. The stimulus has a lot of money to lend, but travelers may still be hesitant to book vacations.
Source : USA Today