Hotel industry seeks $150B bailout as Marriott begins furlough

Industry claimed half of the existing US hotels could close within the year without help

TRD NATIONAL /
Mar.March 18, 2020 08:40 AM
The U.S. hotel industry is asking the Trump administration for a $150 billion bailout. (Credit: Trump by Drew Angerer/Getty Images; Eric Pancer via Wikipedia Commons)

The U.S. hotel industry is asking the Trump administration for a $150 billion bailout. (Credit: Trump by Drew Angerer/Getty Images; Eric Pancer via Wikipedia Commons)

The hotel industry is coming to White House hat in hand as the coronavirus pandemic has chilled global travel.

The American hospitality industry asked the Trump administration for a $150 billion bailout on Tuesday, warning that without the additional cash half of the hotels throughout the country may be forced to close this year, the Wall Street Journal reported.

“The coronavirus has already had a more severe economic impact on the hotel industry than Sept. 11 and the 2008 recession combined,” said Chip Rogers, CEO of the American Hotel and Lodging Association, to the Journal.

Most of the proposed bailout to the tune of $100 billion would go toward retaining workers, while $50 billion is earmarked for debt service. In recent months, a spate of high-profile hotel loans in New York City have gone into default.

The request comes on the heels of another ask, also for a total of $150 billion, from travel related businesses, such as car rental companies and travel agencies, and the airline industry.

While lobbyists continue to try and hammer out a deal, President Donald Trump reportedly pledged his support for the hotel industry.

Severin Borenstein, an economics professor at the University of California, Berkeley Haas School of Business, cast doubt on whether or not a bailout agreement was the best way to help hotel workers.

“I think that if [the government] think that hotels are not going to lay off their workers because they get a cash infusion, I think they’re going to be very disappointed,” he told the Journal. “The money is mostly going to go to bailout shareholders.”

The same day, Marriott International began putting its employees on furlough while the company shut down some of its properties, the Journal reported. The employees, which do not include members of Marriott’s corporate team, will not receive payment, but will continue receiving healthcare benefits. [WSJ] — Erin Hudson


Related Articles

arrow_forward_ios
CoStar CEO Andrew Florance and STR president and CEO Amanda Hite (Credit: Getty Images, STR, and iStock)

CoStar pushes into hotel space with $450M acquisition of STR

CoStar pushes into hotel space with $450M acquisition of STR
Barron Hilton

Remembering real estate empire builder Barron Hilton

Remembering real estate empire builder Barron Hilton
Rami Zeidan

Life House hotel startup gets $100M commitment for US expansion

Life House hotel startup gets $100M commitment for US expansion
Booking.com CEO Glenn Fogel and Expedia CEO Mark Okerstrom (Credit: iStock)

Resort fee wars: Booking platforms are taking on the controversial hotel practice in very different ways

Resort fee wars: Booking platforms are taking on the controversial hotel practice in very different ways
(Credit: iStock)

Korean hotelier and booking platform valued at more than $1B

Korean hotelier and booking platform valued at more than $1B
(Credit: iStock)

This obscure Caribbean island is a favorite among the super wealthy

This obscure Caribbean island is a favorite among the super wealthy
Puerto Rico Governor Ricardo Rosselló (Credit: iStock and Getty Images)

Puerto Rico’s governor touts $120M deal, OZs to hotel investors

Puerto Rico’s governor touts $120M deal, OZs to hotel investors
From left: Hilton Worldwide Holdings CEO Christopher Nassetta, the Waldorf Astoria at 301 Park Avenue, and China President Xi Jinping (Credit: Getty Images)

Hilton chief talks China, the Waldorf Astoria and tipping at NYU hospitality conference

Hilton chief talks China, the Waldorf Astoria and tipping at NYU hospitality conference
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...