The American Hotel and Lodging Association reports a potential avalanche of hotel foreclosures are on the horizon after reporting one-in-four properties are delinquent in their payments.
“It was shutting down the economy too far, too fast and to get it back on its feet would not be without consequence,” UNO Business Professor Mark Rosa explains. “How do you keep these huge properties running with no one there? It’s like that with airlines, it’s like that with cruise ships.”
Rosa says a piece of rescue legislation called the HOPE Act is being backed by industry leaders as a way to keep hoteliers from slipping into foreclosure and shutting down.
The HOPE Act, much like the CARES Act, Paycheck Protection Program, and other rescue legislation being proposed is a lifeline to the Hotel industry.
“It will allow them to keep running, with the idea that we will eventually work ourselves out of this, Mark Rosa says. “The industry might come back, keep pumping money into the system at an enormous cost.”
Mavis Early is the Executive Director of the Greater New Orleans Hotel and Lodging Association. She says hotel owners and operators locally see the HOPE Act as more than just a way to save their properties: “The reasons these small hotels want to try and pass the HOPE Act is because they want to maintain their employees.”
Early says in New Orleans, and many other tourism focused cities, employees in a small hotel are like a family.
Employees stay with a hotel longer than in other places. She says when an employee goes to another property, the friends and close relationships they’ve forged remain strong even though they’ve moved on.
Early says the HOPE Act is needed to stave off property speculators.
“There are people who are waiting for hotels to be foreclosed on and buy them at a bargain price. And so we want the hotels to stay stable, and we don’t want that to happen, “Early says. “And the HOPE Act would definitely help with that.”