How Will the US Hotel Experience Change Post COVID-19?

As hotel occupancy ticks up ever so slightly, the lodging industry is putting new standards in place to enhance cleaning and ensure guest safety.

One organization working overtime to make sure that these new measures are clear and communicated effectively to the public is the American Hotel & Lodging Association (AH&LA), which has created Safe Stay guidelines for the industry.

“Safe Stay was developed specifically to ensure enhanced safety for hotels guests and employees. While hotels have always employed demanding cleaning standards, this new initiative will ensure greater transparency and confidence throughout the entire hotel experience,” said Chip Rogers, president and CEO of AHLA. “The industry’s enhanced hotel cleaning practices, social interactions, and workplace protocols will continue to evolve to meet the new health and safety challenges and expectations presented by COVID-19.”

Travelers in states where shelter in place and stay at home orders have been lifted may be looking to travel and stay in a hotel soon. What will that look like in the “new normal?”

Hygiene will be the number one priority. The Safe Stay guidelines promote frequent handwashing for employees, hand sanitizer dispensers, signage, instructions for mask-wearing and more.

Major hotel brands have launched their own programs, too, partnering with brands such as Clorox and Lysol and the Mayo Clinic.

Hilton CleanStay was launched in partnership with the makers of Lysol as well as the Mayo Clinic. Marriott announced a Global Cleanliness Council, a panel of experts on everything from food and water safety, infection prevention and hygiene, and hotel operations.

Visitors will have a much more contact-less experience when they visit properties while maintaining social distancing guidelines and new standards of cleanliness.

Hilton will have a CleanStay room seal on guestroom doors and guests will no longer find shared amenities such as pens and paper in the room and room directories will be made digital.

Travelers are also likely to find keyless entry to rooms and disinfecting wipes for touching elevator buttons. Room service menus and ordering will likely be done on mobile apps.

Guests should also arrive expecting to self park their vehicles. Resorts such as Omni have limited valet services and instituted social distancing protocols where self-parking is unavailable.

There will also be limits on the number of people allowed to congregate in different areas with limited seating in lobbies, bars and restaurants in order to observe social distancing guidelines. The days of buffet dining may also be a thing of the past. AHLA guidelines say that room service should use contactless delivery and that buffets should be limited and served by an attendant in personal protective equipment. Pre-packaged and grab and go options are encouraged.

Guests may have to plan out their visits to the gym. Expect fitness centers to close multiple times per day for cleaning as well as socially distanced pool areas with lounge chairs six feet apart.

Behind the scenes there will be new cleaning technologies utilized.

One example is Marriott’s deployment of electrostatic sprayers and the use of the highest-grade disinfectant products. Electrostatic cleaning really gives a deep clean to surfaces, the spraying is a method where a device is used to apply an electric charge to a disinfectant, enabling the disinfectant to more effectively cover a surface than traditional cleaning methods.

One of the aspects of hotel stays that remains unknown is how many properties will institute temperature checks but travelers should expect the practice may become quite common.

The Venetian in Las Vegas said that it will use thermal scanners at entry points for a non-invasive temperature check.

Many properties will screen the health of their employees and include temperature checks.

Caesars Entertainment said that it will institute health screenings for all employees that include taking temperatures and COVID-19 testing.

While most hotel guidelines call for near-constant cleaning and disinfecting, travelers can also do their part.

Hand washing and the use of hand sanitizer should be frequent when traveling. Many properties plan to provide face masks and disinfectant wipes, but it doesn’t hurt to bring your own and wipe down surfaces, doorknobs and buttons.

Wearing a face mask is also recommended to protect both you and those around you.

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How the Hotel Industry Will Bounce Back After COVID-19

The resiliency of the hotel industry will help it rebound as the effects of the coronavirus ebb, according to GlobalData, a data and analytics firm.

“It is imperative that hotels across the globe remember how they have overcome a range of past crises, such as natural disasters, the SARS outbreak and acts of terrorism when thinking through their strategies to handle the COVID-19 crisis,” said Ralph Hollister, a travel and tourism analyst for GlobalData. “As the impact of COVID-19 lessens and demand increases, it is crucial that hotels act in a proactive manner by effectively managing room rates and marketing offers to maximize revenues.”

He added, “Hotels that are the fastest to drop their room rates and who provide the heaviest discounts will often be the last ones to recover when demand eventually returns. Many hotels will not be able to return to their normal rates instantly after demand for travel returns.”

In the view of Becky Lukovic of Bella Travel Planning, it depends on how deep the discounts are and how many properties are offering them.

“The public is expecting discounts so they will be drawn to the properties offering [them], provided they are in an [properties with] acceptable levels of comfort and service,” she said. “That said, those who discount may take longer to recoup their lost income and it might be difficult to stay afloat. We also need to keep in mind that a good portion of the traveling public may also be hurting financially, so travelers may need these discounts to even consider traveling.

Claire Schoeder of Elevations Travel noted that in the past, hotels were the fastest at dramatically dropping rates subsequently had issues in obtaining new bookings when demand increased and rates were raised significantly.

“Travelers saw that and selected hotels that did not appear to have substantial price increases when demand increased,” she said. “A number of hotels lowered prices a bit and then simply raised rates as demand increased. There was not a substantial decrease or increase,” she said.

Meanwhile, Susie Chau of Carpe Diem Traveler believes that hotel rates will need to be adjusted going forward, and in all likelihood, increase based on supply and demand.

“Some hotels may offer initial discounts to lure the first wave of travelers, but that’s likely not financially sustainable after such devastating losses over the period that the travel restrictions will last,” she said.

Travel advisors, meanwhile, were mixed on how and when the hotel industry will make a recovery.

“If this ends relatively soon (like before summer), then I think people will trickle back into travel in the summer and many will keep their reservations for fall,” Lukovic said. “That said, we have an election coming up, and historically, from my perspective, the uncertainty an election brings keeps people home near those months.”

Said Chau, “Some travelers will have very itchy feet and want to leave home as soon as possible, while others may be more cautious in the beginning and/or will not have the same financial means to travel as they did before the crisis.”

For her part, Schoeder is of the opinion that the hotel industry will indeed be one of the first travel segments to bounce back. “I think we will see hotels offering very attractive promotions that will not damage their brand to get people booking again,” she said.

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How the CARE Act Can Provide Relief to Travel Advisors

Last week, Congress passed a massive stimulus bill known as The Coronavirus Aid, Relief, and Economic Security (CARES) Act. In it is relief for struggling travel advisors but, as these bills usually are, the language is dense and hard to decipher—so ASTA has stepped in to outline the benefits.

One of the clearest parts of the bill was the $25 billion in loans and loan guarantees reserved for the airlines and “ticket agents,” but there are many ways in which travel advisors can get financial relief from the bill.

“Most members will access relief through the Small Business Administration program,” ASTA President and CEO Zane Kerby told advisors on the webinar.

One of the major benefits of the CARES Act is that it opens access to unemployment benefits to independent contractors and the self-employed.

Workers on 1099 are not usually eligible for unemployment because they don’t pay into state unemployment programs; however, the CARES Act recognizes that this global pandemic has created an unprecedented need for relief. Self-employed people’s incomes have been decimated by this crisis, and now they will be able to have access to these benefits.

“Through the end of the year, ICs who meet the stated criteria can receive benefits through their state unemployment program to essentially the same extent that they would have if they were W2 employees,” said Peter Lobasso, Senior Vice President and General Counsel at ASTA.

The IC only needs to certify that he or she has been adversely impacted by COVID-19 and, but for that, would have been able to be available to work as usual.

“I believe that this requirement will be very loosely interpreted,” said Lobasso.

The amount of the benefit will be determined by each state’s computation system, but it will definitely be based on the IC’s net income for the last tax year. In addition, the IC will be eligible to receive an additional $600 available even if the worker was previously earning less than that.

The benefit will run through the end of the year, and those needing access should contact their state unemployment agency.

New Loans

Companies with more than 500 employees have access to $454 billion in loans and loan guarantees to support eligible U.S. businesses that have not received adequate relief from other available loan programs. This is in addition to the $25 billion that is earmarked for the airlines and travel agencies.

Applicants for these loans must establish that alternative financing is not reasonably available.

The terms are up to five years; interest is at prevailing market rates prior to COVID-19, and there is no loan forgiveness. The Treasury Department will be publishing application procedures and minimum requirements within 10 days of bill enactment.

SBA Economic Injury Disaster Loans

There are special SBA loans for businesses with fewer than 500 employees. Businesses don’t need to have employees to qualify, so independent contractors and self-employed people qualify for these SBA loans.

Loans provide up to $2 million and are designed to provide working capital for regular business expenses such as rent, payroll, utilities, etc.

The interest rate on these loans is 3.75 percent, and the maximum term is 30 years. There is no collateral or personal guarantee needed, and there is a one-year deferment on the first payment.

As of March 13, all 50 states and Washington, D.C., have been declared disaster areas for SBA purposes.

The SBA says that the best way to apply is online, which will be the fastest way to get approval.

Small Business Interruption Loans

This is a new program that loans up to $10 million to U.S. businesses that fall under the SBA size standards ($22 million in annual revenue or with 500 or fewer employees). Independent contractors and the self-employed are also eligible for these loans. These guidelines are less restrictive than they were previously, and these loans no longer require collateral or guaranty.

The portion of these loans that covers payroll, mortgage, rent or utility expenses from February 15 to June 30 may be eligible for loan forgiveness in whole or in part.

There is a less rigorous application process for these loans, and they have fixed low-interest rates and terms of up to 10 years.

Airline Economic Stabilization Loans

There is $25 billion set aside for Airline Economic Stabilization Loans. These are available through the Treasury Department for “ticket agents” and other related aviation industries. The Treasury Secretary and the Secretary of Transportation allocate these funds, and ASTA will work with these departments to implement the provision.

ASTA said that this portion of the relief package is probably going to take the most time to sort through because it is done in consultation with so many outside partners.

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