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Md. hotels fighting to survive COVID-19’s economic impact

EASTON — Normally, the beginning of spring kicks off with a big boom in business after the offseason lull at the Hummingbird Inn on North Aurora Street. COVID-19 has made sure that will not be the case this year.

“It’s a pretty scary situation right now,” Hummingbird Inn owner Eric Levinson said. Currently, one of his nine rooms is occupied.

For Levinson and other Maryland hotels there is little, if any, business right now because of government-enforced restrictions across the United States and the overall angst of contracting the virus. Levinson has had to refund some customers who had to cancel their stays.

Usually, the hotel business is strongest from March to November in Easton. The Eastern Shore Sea Glass and Coastal Arts festival that was scheduled to take place on April 4 and 5 has been postponed. During the festival weekend, the Hummingbird Inn normally is fully booked.

To help mitigate the damage, Levinson has offered guests a non-expiring credit for their room down payments. Most guests have decided to be compassionate, understanding the Hummingbird Inn is a small business and allowing the inn to keep the room deposits as credit for a future visit. Others guests cannot afford to do so and need their deposits back as quickly as possible.

Still, no new reservations are being purchased at the moment, and most of the reservations for next quarter are being canceled, Levinson said.

“There are a couple of people hanging on,” he said, referring to guests who have reservations. He acknowledged some people are not allowed to travel or simply do not want to because nothing is open.

“Traveling somewhere where there is nothing to do is not a desirable goal,” Levinson said. The reality of this health and economic crisis is forcing hotels to make difficult decisions.

Staff reductions

The American Hotel and Lodging Association is seeing major economic impact on the hotels it represents. With income down, staffing at almost all locations is taking a hit.

Amy Rohrer, president and chief executive officer of the Maryland Lodging and Tourism Association, has been collecting responses from hotel representatives to present to Congress in an effort to get any help possible to support the industry.

“The situation for hotels is dire,” said Rohrer, a native of Arnold.

“We are seeing a number of hotels suspending operations, and those that are still operating are doing so with often 80% of their staff being laid off,” Rohrer said. “I am hearing of hotels operating in single-digit occupancy levels, where a healthy hotel industry is normally operating at least a 65% occupancy.”

At Levinson’s inn, he has had to send most of his staff home. The only people staying on right now are the groundskeepers, as he tries to keep the place looking presentable. Housekeeping and servers are on call because they are not needed on a regular basis, he said.

“It’s unfortunate,” Levinson said. “And I wish I could help them, but I got to try and keep the lights on here.”

General Manager Lauren Catterton of the Tidewater Inn in Easton did not want to say exactly how many or if employees had been laid off, but she said the hotel was experiencing “significant changes” in staffing.

“Our core management team is doing everything they can to keep everything going and sustain our business and get ready for spring,” Catterton said.

The situation seems to be similar across the state.

In fact, Maryland has seen 13,640 direct hotel-related jobs lost and 42,631 total jobs lost that support the hotel industry, according to numbers provided by the American Hotel and Lodging Association.

“As a hotelier in Maryland I have experienced firsthand … the enormous amount of cancellations that have drastically cut the hours of most of our associates,” Andrew Labetti, of Millersville, is quoted in the collection of responses sent to Congress from the American Hotel and Lodging Association.

Another hotelier is quoted in the collection: “Since we now as of this weekend have a no gathering mandate with 50 people or more this leaves a majority of our groups and meetings that must be canceled which again leaves no hours for the banquet staff and all hotel staff,” said Jaime Jones of Severn. “We as a hotel must survive on our groups and travelers and when that stops then we as a hotel must take action and put into place means to save money, which most of the time means cutting hours back for people that are already stretched too thin, and laying people off.”

Hotels are essential

On Monday, March 23, Gov. Larry Hogan ordered the closure of all nonessential businesses in Maryland. Hotels are considered essential businesses under the commercial facilities sector in the order. Throughout the COVID-19 crisis, hotels have been used to do more than house tourists.

The Maryland Lodging and Tourism Association is working with the government to determine which hotels can provide rooms for first responders, National Guard soldiers and medical patients. Some Baltimore City hotels even house cancer patients from other countries, Rohrer said.

“It is essential that we are able to continue operating,” she said. “We are experiencing devastating losses, and it is a struggle to keep the doors open at this point in time.”

The Tidewater Inn has roots dating back to 1712 in the Easton town center. When the hotel is open and fully operational, it helps support the local economy by attracting guests, who spend money in places such as restaurants and shops, Catterton said.

The hotel has partnerships with local theaters, organizations and agencies. For example, during Easter the hotel has a buffet that usually serves about 700 guests. That event has been moved to a curbside pickup service this year.

“We are a community of hospitality with all our restaurants, hotels and B&Bs,” she said. “It’s been very hard, but we are trying to stay positive and do everything we can to keep everything going.”

Hotels are coming up with ways to attempt to survive this economic turmoil.

Methods of survival

The Maryland Lodging and Tourism Association is “considering everything” when deciding on the best ways to support area hotels, said Rohrer, who has been with the organization since 2005 and has been president going on five years now. Most hotels are forced to come up with unique ways to get income and keep their employees on staff.

Levinson is hoping the government will tell banks to put holds on mortgage payments for 90 days.

“That’s a huge outlay of cash, and that could be enough money to operate, to actually bring a couple people on staff,” Levinson said. “Keep some of these businesses afloat as long as we can.”

Rohrer has reached out to Maryland counties to request deferments on sales and property taxes for hotels.

“If the counties could defer property and hotel tax payments, that would immediately help us to increase cash on hand and keep more of our employees working,” Rohrer said.

The Tidewater Inn is offering curbside and delivery services from its restaurant, Hunter’s Tavern, and so far business is going well there.

“It’s good — they had a really good weekend, but yesterday was slower,” Catterton said. “We are trying to do brunch to go — Thursday happy hour to go. We are trying to keep our locals and our guests engaged with the Hunter’s Tavern. We are still here, and we are coming up with ideas.”

“Our team right now is fighting tirelessly to keep that legacy going,” she said. “Our management team is working really hard to sustain what we have going here.”

Tidewater has been working with other area hotels that are limited service hotels to help them get meals to their guests.

Right now, Levinson is just doing what he can to keep his inn open. He is developing an idea to sell curbside breakfast.

“Lowering costs or prices doesn’t do anything,” he said.

He is working with other local hotels that were told to close during the pandemic and had to leave guests stranded. Levinson was able to offer those guests reduced rates, so they had a place to stay while they were in town.

Light at the end of the tunnel

Catterton is optimistic about the future and said it is her job to express that mindset to her guests and employees. The employees they were able to keep on staff at the Tidewater Inn are busier than ever preparing for a day when the virus has subsided.

“When the flood gates open again, we are ready to go,” she said.

Her staff is revamping. The sales team is coordinating with brides and grooms whose weddings were scheduled for March and April, and now have to be moved to another date. They also are busy planning for 2021.

“We have a bright future ahead of us,” she said while showing off all the new renovations that are taking place in the hotel, such as the spa and third-floor rooms. The company is completing renovations on an additional property on Dover Street.

“We have a lot to showcase when we reopen, and we are excited about that,” she said.

Per the government mandate, the hotel will not be able to execute any banquet or corporate events until May 10. The current hotel occupancy level also is limited, she said. But it does have a few guests, and the restaurant is open seven days a week serving curbside and delivery.

Tidewater Inn’s curbside is available 11 a.m. to 6 p.m., and pickup is available from 11 a.m. to 7 p.m. The inn also has a brunch option from 8 a.m. to 10 a.m. Saturdays and Sundays. All information can be obtained on the company’s website, Catterton said.

Easter to-go will be available, so customers can pick up Easter dinner or brunch for their families. More details on this service will be released soon, Catterton said.

Despite her efforts to remain positive, she is aware not all hotels in the area can remain as optimistic. Maryland hotel managers and owners are not sure what the outcome of the virus will mean for their businesses, or how long it will last, but they seem to be willing to fight until the end, and the Maryland Lodging and Tourism Association seems to be with them during this fight.

“The reality is that maybe there are some smaller hotels that aren’t able to reopen,” Rohrer said. “The landscape is changing sometimes by the day, sometimes by the hour.”

“We will come out of this,” Rohrer said.

Resources for Marylanders and employees during COVID-19

SBDC Webinar - Topics: EIDL and CARES (PPP) COVID 19 Loans

Monday 4/6/2020, 1:00 PM - 2:00 PM (EDT)

Space is Limited ~ You Must Register: https://mdsbdc.ecenterdirect.com/events/16175

Please RSVP with a valid email. After registering, you will receive a Zoom Meeting link to join online, or you can join via the dial-in number. This webinar will be recorded and shared, and if space fills up, additional dates will be added.

Daily SBA Conference Call – Updates (M-F) provided and you can ask questions.

3:00 p.m., Call 202-765-1264, Conf Call ID# 827-299-626

5:30 p.m., Call 202-765-1264, Conf Call ID# 310-688-488

EIDL Application Help – Daily 10:30 a.m. and 8:00 p.m. On the call, an SBA agent will walk you through how to fill out the EIDL form. Have all your necessary documents ready. Zoom Meeting # 6794772946

Paycheck Protection Program Loan (PPPL) FAQ - 

bit.ly/PPPL_FAQs

SBA COVID-19 Small Business Guidance & Loan Resources

https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources#section-header-0

Main Maryland Business Information Site for COVID 19 updates and resources - https://govstatus.egov.com/md-coronavirus-business