5 Trends Predicted for the Lodging Industry in 2021

The way most of us view travel and vacations now is quite different in the aftermath of a global pandemic. While the popularity of Continue reading “5 Trends Predicted for the Lodging Industry in 2021”

Survival Mode Improves Brand-Owner Relations

COVID-19 threw a few punches at the hotel industry, but despite an extremely challenging year, some would argue Continue reading “Survival Mode Improves Brand-Owner Relations”

Rising Above 2020: The Worst Year on Record for U.S. Hotels!

It’s official, 2020 was the worst year on record for the hotel industry. For the first time in history, the industry surpassed 1 billion unsold room nights, which eclipsed the 786 million unsold Continue reading “Rising Above 2020: The Worst Year on Record for U.S. Hotels!”

The Real MVPs – Markets That Outperformed in 2020

When COVID-19 hit the States and stay-at-home orders swept across the nation, it is no wonder that the hotel industry took a steep dive. While 2020 started out as just another year, April soon became Continue reading “The Real MVPs – Markets That Outperformed in 2020”

Breaking News: Bars to Re-Open Monday at 50% capacity in Florida!

This evening, the Florida Department of Business and Professional Regulation (DBPR) issued Emergency Order 2020-10, which permits bars to re-open on Monday, September 14, at 50% capacity.

Under the Order, bars and other alcoholic beverage vendors may resume sales of alcoholic beverages for consumption on premises beginning Monday, provided that their operations comply with the parameters of Phase 2 of Governor DeSantis’ “Safe. Smart. Step-by-Step. Plan for Florida’s Recovery as established in Executive Order 20-139.

On Monday, these vendors may operate at 50% capacity of the facility’s indoor capacity, allow bar service to seated patrons, and permit outdoor seating and service with the appropriate social distancing.

“In meetings with hundreds of owners of bars and breweries across the state, I’ve heard their stories of struggle, and I’ve observed their serious commitment to making health and safety a continuing priority in their businesses,” said DBPR Secretary Halsey Beshears. “It’s time that we take this step, and it’s vital that we start moving forward with this sector of our hospitality industry who have endured one of the toughest paths for sustaining a business during this pandemic.”

For more details, please see the complete Emergency Order linked below:

DBPR Emergency Order 2020-10

Source: FRLA

Handling Your Hotel Loans Amid the Coronavirus Pandemic

With the sudden arrival of the Coronavirus Pandemic, the hospitality industry has been hit hard. Between the fear, anxiety and social isolation of consumers and the government ordered lockdowns and no travel orders, occupancy of many hotels is down to an alarming level. It is anticipated, by the American Hotel & Lodging Association that more than half of U.S. Hotels may close before the end of 2020.

How will Lender’s respond to the crisis?

Unfortunately, we cannot predict how the Banks are going to be responding to the sudden and severe financial distress of their Hotelier Borrowers. Unless your loan agreement, note, and mortgage specifically includes a force majeure clause or a similar clause including a viral pandemic (see Gulati Law Blog Coronavirus and How it Affects your Contracts) providing some type of cure, then the Lender has the right to default you and pursue all legal remedies including acceleration of the debt and foreclosure of the property.

What Can I do to Get Ahead of the Crisis?

It is important not to wait until you receive a notice of default to take action. Reaching out to your Lender in anticipation of default is vital to reaching a resolution. Gulati Law has trained attorneys who are able to reach out to your lender to discuss forbearance, deferment of payments, or other solutions that work for both you and your lender.

Is Refinancing an Option?

Even before the start of the pandemic, mortgage loan interest rates had been at an all time low. It is the hope of the industry that these will stay low or continue to fall leaving an opportunity for hotel owners to refinance their existing loans. It is of the utmost important to have a qualified attorney review any refinance documents prior to execution. Gulati law has been successful in negotiating refinances with the best terms for our clients and can close all loans in house.

In addition to the option of refinancing, there may be other options as Congress convened over the weekend to discuss legislation intended to provide stimulus for the American economy, called the CARES Act. Stay tuned for more updates on this proposed Act.

 Information Needed Prior to Reaching out to the Lender

  1. Actual Borrower Name, any Guarantor Names, Property Address and ID Number;
  2. History of good payments;
  3. Positive stories about the quality of your hotel and customer service;
  4. Occupancy issues and other current financial strains; and
  5. Possible financial payments you CAN make (if any) until the economy recovers.

Contact Gulati Law, P.L. for Assistance

We cannot reiterate enough that you should contact a qualified attorney to correspond with your lender on your behalf. Contact our office today to discuss retaining our services immediately (initial letters to your Lender may be complimentary on a case by case basis).

Remember to stay positive! We believe that once this crisis passes, we will be stronger than before!

 

Sources: Congress.gov, AHLA, AAHOA, Hospitality Mgmt

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