Georgia’s hotels call for federal relief to stay open, protect remaining jobsThe Atlanta Marriott Marquis reported plans to lay off 784 workers on March 14. File/Credit: Kelly Jordan
By David Pendered
Metro Atlanta is in the Top 10 regions in the nation in the number of hotels that are delinquent in paying their mortgages, a new report shows. The massive layoffs in the hotel sector at the start of the pandemic evidently did not prevent the financial stress.
Nearly 1,700 hotel workers were to be laid off on just one day, March 14, according to data submitted by the hotels and reported by the Georgia Department of Labor.
The ax is to continue to fall through, at least, Sept. 30. That’s the date Wyndham Atlanta Galleria has reported it intends to lay off an estimated 50 workers.
Highlights of the delinquency report by Trepp, a monitor of the commercial real estate industry, show metro Atlanta’s relative standings in three key areas of mortgage delinquency:
- 10th – Highest dollar value of delinquent loans ($169.5 million);
- 6th – Highest percentage of delinquent loans (11.7%);
- 6th – Highest number of delinquent loans (19).
The figures are as of July 20, the most recent available, according to Trepp’s report. The hotel sector has been the most heavily hit since the start of the COVID-19 pandemic, according to the report.
Four organizations of hotel operators cited the report as part of their campaign to urge Congress to provide relief funds from an expected future round of federal funding related to COVID-19. The groups are lobbying for passage of version of the bill drafted by the U.S. House of Representatives – the HOPE Act.
The four organizations are: American Hotel and Lodging Assoc.; Asian American Hotel Owners Assoc.; Latin Hotel Assoc.; and National Association of Black Hotel Owners, Operators and Developers.
Nearly 4,000 industry leaders signed a letter sent to Congress on Aug. 22, including dozens of hotel operators in metro Atlanta and Jim Sprouse, executive director of the Georgia Hotel and Lodging Assoc.
The HOPE Act would help commercial property owners by providing them with temporary liquidity in exchange for a preferred equity interest in the property, according to Chip Rogers, the former Georgia legislator who now serves as president/CEO of the AHLA. No new federal funding is needed, as the program would be backed by proceeds of the existing CARES Act, Rogers said in a statement.
- “With record low travel demand, thousands of hotels can’t afford to pay their commercial mortgages and are facing foreclosure with the harsh reality of having to close their doors permanently. Tens of thousands of hotel employees will lose their jobs and small business industries that depend on these hotels to drive local tourism and economic activity will likely face a similar fate.”
Hotel staffs already have been hard hit, according to data submitted to the Georgia Department of Labor.
Nearly half of those 1,690 estimated layoffs on March 14 were posted by the Atlanta Marquis, according to a report submitted by Marriott Hotel Services Inc. The same group posted 22 layoffs at Stone Mountain Inn; 237 layoffs at the Atlanta Evergreen Marriott, in Stone Mountain; and 77 layoffs at its Midtown location.
Andy Ingraham, president/CEO of the National Association of Black Hotel Owners, Operators, and Developers (NABHOOD), cited the desire to protect jobs in his call for passage of the HOPE Act:
- “The HOPE Act is essential in helping provide hotel owners with liquidity when we need it most and will serve to help keep businesses open, thus saving local jobs.”