The hotel industry is asking for a $15 – $29 billion bailout, with 40% earmarked for hotel investors to make mortgage payments to big lenders. This is being pitched as something that ‘goes well with infrastructure’ which the federal government is preparing to spend $3 trillion on. Of course, the hotel buildings already exist and aren’t new infrastructure.
The American Hotel and Lodging Association’s chief lobbyist complains, “You have whole segments of our industry that did not receive any financial assistance whatsoever.” It’s not fair that everyone else has been taking your money and hotels haven’t been able to do so yet.
But did you know that 60% of hotel owners got forgivable PPP loans? Did you know that Marriott actually earned a $198 million profit in the U.S. and Canada in 2020 (they lost money only in Europe, Middle East and Africa)?
And the industry has its hand out when occupancy is already back to just 15% below 2019, which was a peak.
Bailing out hotels also means bailing out foreign corporations, since purchases of U.S. hotels was one of the top areas for foreign investment prior to 2019. Thousands of hotels were asking guests for donations in addition to their room bill last year, even when these hotels were owned by large foreign corporations. These weren’t donations ‘to support employees’ these were literally donations for the hotel’s ownership group.
Nonetheless, here’s what the American Hotel and Lodging Association is asking Congress for,
The AHLA’s grant proposal would provide hotel owners with funding where 60 percent would go to keeping employees on the payroll and 40 percent would go to servicing debt like mortgage payments.
While the program would apply to the entire industry, the AHLA is drafting its plan with the hardest-hit operators of properties like convention hotels in mind.
Hotels like the Hilton at the Austin Convention Center, which is owned by the city would get the biggest bailouts.
Of course if a hotel ownership group isn’t able to service its mortgage, and lenders foreclose, the property will change hands – but is still standing and can go on to operate and employee staff.
Hotels are in business to make a profit. They should feel comfortable asking for bailouts. It’s our government representatives that should feel uncomfortable actually giving those bailouts.
@ Gary — Where is my bailout? I am so furious with this crap.
Gary how many hotels does Marriott own? Not many, so not sure what you’ll do when the owners go bankrupt and close the doors
@Me – you mean when the property is taken over by the lenders, and either continues in operation or reflags?
What happens when the owners go bankrupt? The financer takes over and rebrands the hotel to Sonestra.
This is why both Trump and Biden bought the silence of Americans with a $1400 bribe. If Americans found out what they actually did in the stimulus they’d have rioted.
Not that I support bailouts for hotels, but when the Kennedy Center gets $45 million so politicians can watch ballet, Sudan gets $500 million, and Pakistan gets $20 million for transgender studies, I understand why hotels think it’s not fair for them to not get a piece of the pie. Hotels didn’t shutdown the country and travel: the government did unnecessarily. It’s only fair hotels get the same deal Sudan and the Kennedy Center got.
As I have said before, i rather all citizens 18 and over get $1200 monthly checks from the government. Maybe politicians will be forced to stop sending money to Sudan, wasting it on a worthless military, stop perpetrating the war on drugs, and not prop up their Kennedy Center. Republicans are foolish for not calling out the Dems and not offering an alternative. They can come out in support for monthly UBI for all citizens and $20 minimum wage contingent on mandatory deportations/strict border security/extreme e-verify enforcement but of course just say no. They do so because they are part of the grift like Dems. All have backroom deals. They don’t actually want to cut out all welfare programs and eliminate bureaucracy with UBI. They can hide behind welfare programs. They can’t hide when all citizens get equal checks every month.
Mr Waterson mentions the money given to the Kennedy Center. I submit that Speaker Pelosi’s support and that of other members of Congress is understandable, if not forgivable. What troubles me more is that those responsible for the Kennedy Center accept the funds as if they were owed the Center. Had they any backbone, the management and direction of the Kennedy Center would have said, “Thank you, but no thanks.”
If our representatives believe the KC, and the art forms it presents, is important to the national welfare, they should fund it with regular appropriations and not sneak funds in as part of a Covid-19 bill.
The KC will have its hands out seeking support from those who attend events there, as well as from the well-heeled who able to make far more sizable contributions.
As to the hotels, to me they are like others who’ve benefitted from undeserved Congressional largess. Congress should have done far more for small businesses. Investing in hotels is like investing in the stock market: one is subject to losses as well as profits. With first-rate accountants those investors might reduce their losses. The rest of us are under no obligation to help them cover those losses.