INDIANAPOLIS, Ind. – The COVID-19 pandemic is causing the hospitality industry to make very tough decisions. Hotels in downtown Indianapolis that typically see thousands of people a week are shutting down operations.
Hotels should be at a 70% occupancy, but instead no travel means drastically low numbers. Hotels are down to two or three-percent occupancy according to Senior Vice President of Visit Indy, Chris Gahl.
“We had a very strong January, a very strong February and then the crisis hit,” said Gahl.
The JW Marriott, the city’s largest hotel, has shut down operations temporarily and they’re not alone.
“We’ve seen a lot of our hotel partners unfortunately furloughing and shoring up staff in the interim. We know they’ll be needed again to bounce back, once our hotels are full again,” Gahl added.
It’s a big hit for the 83,000 men and women who rely on tourism for a paycheck. Nearly 12% or 10,000 of those workers are in our hotels.
“They are the house keepers, they are the front desk clerks, the men and women who make those hotels work,” said Gahl, “Many of those hotels with the doors closing, even if it is just temporarily the ripple effect is not only from the guest perspective, but it’s the men and women who are inside who would normally be earning paychecks.”
Patrick Tamm is the President and CEO of the Indiana Restaurant and Lodging Association. He says the closure of hotels has a domino effect on collections of sales tax, food and beverage tax and rental car and ticket tax.
“Indianapolis is more reliant on group business than any other market in the country,” said Tamm. “You’ve basically stopped a freight train. Everyone talks about 0 to 60, we went from 60 to 0 in a nanosecond.”
Members of hotel leadership are not taking these decisions lightly.
“The gentleman that runs as general manager at the Hyatt, 10 years ago started out parking cars there,” Tamm explained, “So, when he’s had to make those decisions, he understands the impacts.”
Both Tamm and Gahl believe hotels will bounce back. Weekly conversations between Visit Indy and hotels are helping understand where the industry stands now and where it will be in the future.
“We’ll have a big update meeting tomorrow (Tuesday) with them to also hear about how they’re closing, when they are closing and if they are closing,” said Gahl. “We’re in daily conversations with our hotel partners to understand what they’re hearing, what they are doing proactively and reactively, during this tourism crisis.”
Showing groups and conventions, Indy is still the place to visit once it’s safe to do so.
“Rather than canceling their meeting, can we postpone it and push it further into 2020 or even an additional year, so that message has been effective, and we’ve had some success in moving conventions from spring into summer and dare we say, from fall into winter,” said Gahl.
Last year, Indianapolis welcomed 30 million visitors, a record-setting number according to Visit Indy.