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Hotel Operators are Being Forced to Pivot and Modify in the Time of COVID-19

TORONTO — As COVID-19 forces the hotel industry to rewrite the rules of the hotel game, hoteliers are being forced to make daily changes to how they run their businesses. And, with governments now looking to reduce the varied restrictions in play since March 13, hotel operators are examining ways to return to business while keeping guests and employees safe.

For operators, such as Aodhan Sheahan, vice-president, Operations of Calgary-based MasterBuilt Hotels, and Guido Kerpel, COO at Shelton, Conn.-based New Castle Hotels, COVID-19 continues to test the hotel industry in ways no one could have imagined just a few short months ago. The two executives spoke recently during a CHIC Best Practices webinar called “Operating in the time of Corona,” organized by Big Picture Conferences and moderated by Sylvia Occhiuzzi and Nicole Guyen of CBRE.

According to Kerpel, from the early days of the pandemic, the decision whether to stay open or close properties became front-and-centre for most brands. In many cases, he said, decisions to keep hotels open were analyzed on an individual basis, depending on varying factors. And, in some cases, it was actually better to stay open as opposed to closing, said Kerpel — even with very low occupancy rates — due to added expenses of having to eventually reopen.   

Right off the bat, both hoteliers had to make instant adjustments to operating procedures — from eliminating buffets and replacing them with grab-and-go breakfasts to closing the pool areas and workout spaces to removing all collateral from guestrooms — all in the name of keeping guests safe.

“It became clear early on that this was going to be something significant,” recalled Sheahan, explaining sanitation guidelines became front-and-centre and staff training intensified. “We held on to fitness centres as long as possible,” says the hotelier adding, “We asked ourselves if we could operate some of the services in a safe manner, we’d do it,” said Sheahan. “We’re always leaning to safety without forgetting that we’re hotels providing hospitality,” especially, he adds, for those guests staying longer periods of time. “But we needed to find the balancing act.”

Many of the hotels also started installing plexiglass in almost every area of the hotel — from office workstations, to kitchen restaurants, to workout areas and the front desk. “I wish I had invested in companies making plexiglass,” quipped Kerpel, explaining his hotels have purchased a ton of it.

With the situation evolving daily, New Castle’s Kerpel said communication became paramount, adding “it’s not what you do, it’s how you do it.” Both hoteliers made sure staff, management and guests alike were kept informed about the myriad changes, with staff being updated mainly through Zoom meetings, which were held every few days.

With a portfolio of brands that include full-service hotels and select-service properties, Kerpel said, in many instances it was easier to keep the extended-market segment running as “they almost require no service at all, so it’s a pretty profitable business.”

Understandably, cleanliness and sanitation have become key buzzwords and areas of focus during this time. Kerpel says his hotels now have guestrooms sit idle for two days before having employees enter the room to clean them to ensure whatever virus may exist is gone. Where cleaning was a back-of-the house function in the past, he says, moving forward, it’s now about the theatrics of cleaning. “While previously, most cleaning was done during the night, it’s now being done throughout the day,” he said, explaining doorknobs, floors and elevator buttons have become key sanitation touchpoints. “It gives customers a feeling of confidence that we know what we’re doing,” said Kerpel, pointing to upgraded programs such as Marriott’s new deep-cleaning procedures as an example of stepped-up efforts.

According to Sheahan, as important as cleaning is and always has been, it’s now more important to communicate the cleanliness protocols to guests in order to build confidence. “Historically [cleanliness] has been just as important, but it was the baseline expectation; now it’s a front-of-the-house product. It’s a part of what the customer is buying and it will become part of the branding.”

Interestingly, the enhanced cleaning protocols might also end up being a competitive advantage over Airbnb, explains Kerpel. “As an industry, we know what we’re doing and this might help us out, as an industry, compared to if you go to someone’s house where you may not know what you’re getting.”  

Because the COVID-19 situation is so fluid, the two hoteliers stressed the importance of having guidelines in place for operators to follow. “I’m really proud of what our VPs have put together in a few weeks,” said Kerpel, adding it really helps to be able to give staff an entire book with guidelines. And, as important as government directions are, both hoteliers say it’s important to determine what works for each property. “It’s our job to reimagine those spaces with physical distancing,” said Sheahan, to help build consumer confidence. “We need to take responsibility for reimagining those spaces,” and relay that info back to guests through signage to ensure safety.  

While both hoteliers look forward to seeing the industry slowly reopen, neither see convention business returning until later this year. “I’m concerned, from a size point of view, that it won’t allow conventions to return in Q3,” said Kerpel.  

“We need density in our banquet space to make money and how does that work when rounds of eight now become rounds of two?” asked Kerpel. He also suggested brands become proactive by posting photos on their websites of new conference seating to ensure meeting planners understand what physical distancing in convention spaces may look like in the short term.

Finally, the technology piece of the puzzle continues to be a big part of solutions moving forward. “The industry has been slow to adapt technology, because at the core, we’re hospitality people,” said Kerpel. But, he adds, it’s also because of the magnitude of capital required. “It’s not inexpensive. But there is a seismic shift to get on the bandwagon. Remote check in is here to stay,” he stated.

At the end of the day, the new normal will mean extra costs will be incurred along the way. And, undoubtedly, that will create pressure on room rates. And, as tempting as it may be to cut rates to win the business, said Kerpel, it’s important, “that we don’t undercut each other.”

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