Hotel industry remains on brink of collapse as COVID-19 continues to slam the industry: AHLA
The hotel industry remains on brink of collapse amid the pandemic, according to the American Hotel & Lodging Association. Yahoo Finance's Melody Hahm discusses.
- And welcome back to Yahoo Finance. Time for "Word on the Street." We want to go to Melody in Los Angeles because you've got-- you know, the hotel industry. You've got news for us because it remains on the brink of collapse for a lot.
MELODY HAHM: Yeah, the American Hotel and Lodging Association out with a pretty new report talking about Labor Day weekend hotel bookings, right? It's coming up this weekend. Typically it is seen as the hottest weekend to be traveling as we embark in the fall season, but hotel bookings are actually down 66% compared to last year. And currently four out of 10 hotel workers are not working, with about 65% of hotels operating even below break-even point.
This shouldn't necessarily come as a surprise to your point, Adam, as we've been talking about the hospitality sector really getting hit perhaps the hardest when you look across the board industry-wide. And this is as the hotel industry is facing a historic wave of foreclosures, as the pandemic has devastated small-business hotel owners, many of them franchisees, and their workforces.
Actually since the beginning of COVID-19, the hotel segment has actually faced a historic number of delinquencies and is the most heavily hit sector when it comes to CMBs, those commercial mortgage backed securities. And actually 4,000 hotel industry leaders sent a letter to Congress urgently asking for more PPP support, more additional resources, and leniency as they try to figure out ways to open. This also paired with a new report out from Airbnb today actually, that finds that-- surprise, surprise-- the city exodus continues, although there is a little bit more traction and folks looking to travel back into the city as they think about Christmas and Thanksgiving and are planning to travel accordingly.
Although, you know, one fun point here, looking at the top destinations in terms of bookings for this weekend. Hilton Head, South Carolina; Big Bear Lake, California; Charleston, South Carolina; Scranton, Pennsylvania; Palm Springs, California; and Orange Beach, Alabama, are among a couple of those names that people seem to be highly coveting. And I'll tell you anecdotally, I'm actually driving to San Francisco along Big Sur along the Pacific Coast Highway, and that's going to be a fun trip, although we started looking at lodging situations a couple of weeks ago, and everything seemed to be booked. So it does seem to be very much a region specific issue there.