AHLA: Va. stands to lose 86K+ hotel jobs without federal support
Report also projects that two-thirds of state's hotels could close
Virginia stands to lose 86,821 hotel-related jobs if Congress doesn’t extend Paycheck Protection Program loans or expand the Main Street Lending program, according to projections released Wednesday by the American Hotel & Lodging Association (AHLA) — and the state may lose all but about 500 hotels to foreclosure.
Pre-pandemic, Virginia was home to 1,532 hotels, but 751 were foreclosed by September. Without help from the federal government, Virginia could see 1,026 hotels permanently closed, the organization anticipates.
With hotels closing, the state also has lost significant jobs, AHLA reported:
- 44,568 hotel-related jobs gone as of September, out of 192,936 total
- 16,042 direct hotel jobs lost, out of 52,382 total
Virginia hotel revenues remained well below pre-pandemic levels last week, according to data from STR Inc., a CoStar Group division that provides weekly market data on the U.S. hospitality industry.
For the week of Sept. 20 through Sept. 26, hotel revenues in Virginia decreased by 47% and rooms sold declined by 29% compared to the same week last year. The previous week saw a 52% decline in revenue and 33% decrease in rooms sold. Compared to last year, the average daily rate (ADR) paid for hotel rooms dropped 25% to $88.48, while revenue per available room (RevPAR) fell to $43.54, a 47% decline.
Hotel revenues and rooms sold declined in most markets in Virginia, compared with the same time frame last year. Compared to the same week in 2019, revenues fell 68% in Northern Virginia, 41% in Charlottesville, and 20% in Hampton Roads. During the week of Sept. 13 through Sept. 19, revenues fell 72% in Northern Virginia, 49% in Charlottesville and 23% in Hampton Roads. The number of rooms sold in Northern Virginia is down by 49%, Charlottesville is down by 27% and Hampton Roads is down by 12%.
Hampton Roads continued to fare well when compared to national rates. It has had the highest occupancy rate among the top 25 markets in the nation since the week ending June 27. However, RevPAR in Hampton Roads was in fifth place at $50.31, behind Los Angeles, San Diego, New York City and Anaheim, California.
Williamsburg continues to be the hardest-hit locality in Virginia, though, seeing a 41% decline in revenue last week, followed by Norfolk/Portsmouth at a 18% decline and Newport News/Hampton at an 16% decline.
“Performance of the hotels in Hampton Roads during this week was in general better than last week,” Professor Vinod Agarwal of Old Dominion University’s Dragas Center for Economic Analysis and Policy said in a statement. “The hotel industry in general continues to recover slowly.”