From the desks of the Hotel News Now editorial staff:
- Whitbread to terminate 6,000 jobs
- Distressed opportunities loom for hotel investors
- New UK COVID-19 restrictions could last six months
- AHLA survey calls for additional government funding
- Condor ends merger agreement with NHT
Whitbread to terminate 6,000 jobs: As the United Kingdom’s government furlough scheme for hospitality employees comes to an end on 31 October, Whitbread PLC said it will lay off 6,000 employees, or 18% of its workforce, which includes 4,500 hotel employees, HNN’s Terence Baker writes.
Alison Brittain, CEO of Whitbread, said “the one-off costs are modest” because many employees are expected to leave voluntarily.
“It is with great regret that we have advised our teams this morning that we intend to commence a consultation process with our U.K. hotel and restaurant colleagues as the furlough scheme comes to an end,” she said, adding that the move ensure the company has a lower cost base and a more flexible operating model while strengthening its resilience.
Distressed opportunities loom for hotel investors: Hotel investors are looking for new ways to acquire distressed hotel assets in the future as CMBS loan forbearance and deferral periods end, HNN’s Stephanie Ricca writes.
During a panel discussion at the recent Distressed Hotels Virtual Forum produced by IMN, speakers said the future is coming.
“The last six months have been characterized by restructurings … but that money is running out. Winter is coming, and we’re all facing some difficult times,” said Rob Kline, CEO of Chartres Lodging Group. “We’ll end up doing a lot of loan restructuring over the next six months and well beyond that.”
New U.K. COVID-19 restrictions could last six months: U.K. Prime Minister Boris Johnson announced new COVID-19 restrictions today and encouraged anyone who is able to work from home to do so to stop further spreading of the infection, the Associated Press reports. The government reported 4,300 new cases 21 September, the highest number since May.
In addressing the House of Commons, Johnson said, “We will spare no effort in developing vaccines, treatments and new forms of mass testing, but unless we palpably make progress, we should assume that the restrictions I have announced will remain in place for perhaps six months.”
Along with shutting down pubs, restaurants and bars at 10 p.m., the new restrictions also requires face masks while taking a taxi or public transportation and limits the number of people attending different events.
AHLA survey calls for additional government funding: Hoteliers who participated in a recent survey from the American Hotel & Lodging Association said they would have to lay off more employees if they didn’t receive further financial assistance from the government, according to a news release.
The survey results show 68% of respondents have fewer employees working full time than they did before the crisis, and “without further governmental assistance, 74% of respondents said they would be forced into further layoffs,” the release states.
The survey also shows that half of hotel owners who responded said they are in danger of foreclosure by their commercial real estate debt lenders because of the pandemic.
Condor ends merger agreement with NHT: Condor Hospitality Trust announced that the company has ended its merger agreement with NHT Operating Partnership “due to failure of NHT's operating partnership to consummate the acquisition of the company and for material breaches of the merger agreement by NHT’s operating partnership and its affiliates,” according to a news release.
Condor could receive a termination fee of $11.9 million within five days of the merger agreement being terminated.
The termination of the agreement was effective as of 18 September.
Compiled by Danielle Hess.