CNBC's Seema Mody joins "The Exchange" to report details on how the hotel industry is doing amid the ongoing coronavirus outbreak. Major hotel chains are temporarily closing properties and seeing occupancy rates tumble as travelers stay at home during the coronavirus outbreak.
Global hospitality research company STR said Wednesday that for the week of March 8-14, hotel occupancy was down 24.4% to 53% year-over-year. Meanwhile, revenue per available room, a key industry metric, fell 32.5% to $63.74.
The numbers echo plunging demand for air travel and cruise ships as travel slows to a trickle. There have been more than 200,000 cases of the coronavirus so far, and governments are imposing restrictions to combat the spread. The United States border with Canada will temporarily close to “non-essential traffic” due to the coronavirus pandemic, the leaders of both countries said Wednesday morning.
“To no surprise, the hurt continued and intensified for hotels around the country,” said Jan Freitag, STR’s senior VP of lodging insights in a statement. “The performance declines were especially pronounced in hotels that cater to meetings and group business, which is a reflection of the latest batch of event cancellations and government guidance to restrict the size of gatherings.”
Even before Nevada ordered the closure of casinos and other businesses, MGM Resorts International and Wynn Resorts announced the temporary closure of their properties in Las Vegas. That includes well-known hotels like the Bellagio, MGM Grand Mandalay Bay, The Mirage and others.
Following the closure of its U.S. theme parks, Disney closed all its owned and operated hotel locations at Downtown Disney in Anaheim and Disney Springs in Orlando, beginning Tuesday. The Disney owned and operated hotels at Walt Disney World Resort and Disney’s Vero Beach Resort will close at 5 p.m. on Friday, March 20, the company said in a statement.
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