Tri-City hotels lay off hundreds and even shut doors to weather coronavirus closures

2020 was shaping up to be a banner year for The Lodge at Columbia Point.

The high-end hotel wrapped up an amazing February and was off to an equally excellent March until the coronavirus spread to Western Washington. Then Gov. Jay Inslee ordered restaurants and bars to shut down, limited public gatherings and asked people to stay home to slow the spread of the virus.

At the same time, business people stopped traveling, canceling reservations worth hundreds of thousands of dollars.

“People aren’t traveling,” said Wendy Higgins, the Lodge’s general manager. “We might have a few people coming from the hospital or who are moving, but most people aren’t traveling because they’re mandated to stay home.”

The Lodge at Columbia Point is far from alone.

Even though hotels and restaurants are allowed to stay open under Inslee’s order, the hospitality industry is hard hit.

Statewide, hotels and motels lost more than $194 million in sales and shed nearly 29,500 jobs in March, according to the Washington Hospitality Association.

Locally, the Marriott Courtyard at Columbia Point and the Hilton Garden Inn on Kennewick shut their doors, laid off a large number of employees and transferred the remaining ones to other locations.

Across the board, the hours for hotel employees have been cut in half leading to widespread layoffs, said Gurbir Sandhu, a managing member of Ignite Hotels who represents the Red Lion Hotel in Kennewick.

This is a step back for the $90 million business that employed more than 1,100 people throughout Benton and Franklin counties in 2018.

Visitors that year spent an estimated $560 million in the Tri-Cities and booked 458,000 rooms, according to Visit Tri-Cities.

And hotel/motel taxes generated more than $1.5 million for local communities.

And the industry was growing.

The Richland Red Lion Hotel, known as the Hanford House is undergoing a major renovation to become a Holiday Inn.

And construction started on three new hotels last year including the Comfort Suites at Kennewick’s Southridge neighborhood, Courtyard by Marriott near the Tri-Cities Airport and WoodSpring Suites north of Columbia Center mall.

Only the Courtyard by Marriot in Pasco opened in February before the pandemic hit.

The others are in a holding pattern as they sort out how to apply for federal assistance that was recently approved, and hoping restrictions ease soon.

A massive drop

Last year at this time, as many as 70 percent of the rooms in the Tri-Cities were booked, Sandu said.

With companies shutting down travel, conventions and events being canceled and sports sidelined this spring, the hotels are lucky to have 15 percent of their rooms rented.

“Everybody is in this boat,” said Higgins, who has laid off 50 workers and switched many of her remaining staff to part time. “People can’t go until June. They’re saying May 4 right now, but we don’t know what that will look like.”

Nearly every business that relies on foot traffic is hurting because of the closures, Sandhu said. With so much of hotel owner’s money tied up in their buildings, it’s hard to pivot to some other service.

Many of the hotels are keeping as many employees working as they can afford, so workers can keep their benefits and so the hotels have staff in place when business resumes.

“Financially, it makes sense for most of the hotels to close their doors,” Sandhu said. “I think they’re keeping their doors open to help their employees.”

In addition to canceled business trips and vacations, the lack of sports tournaments is taking a toll.

The central location and good weather of the Tri-Cities brings hundreds of children and their parents to play soccer, softball, baseball and gymnastics.

A combination of good venues, ample parking and available services makes the Tri-Cities an attractive spot. The traffic is enough to make up about 20 to 30 percent of the hotel business, Sandhu said.

The Lodge also has taken a financial hit by having to shut down its restaurant and bar.

When the news of the closure came on a Sunday, they had until Tuesday to close up. The speed of the closure meant they still had fresh food coming in, she said. They were able to give some of it away, but much of it couldn’t be used.

2020 will be a weaker year

Federal stimulus money is now heading to the hotel industry, which may provide some relief.

Two Small Business Administration programs offer some relief, provided that most of the money goes to paying employees.

Local hotels are beginning the process of applying for help, and determining how much they should ask for.

But even if the stay-at-home order is lifted on schedule, it’s going to be a while before business returns to normal, Higgins said. She expects Western Washington vacationers to be the first to filter back into the Tri-Cities.

“The plus is that when the market starts back up the leisure and luxury hotels are some of the first to recover,” she said.

Sandhu expects the revenue will slowly come back, but 2020 will end up being a worse year than last year, which was already slower than 2018.

“It’s going to come back at about 70 or 80 percent of normal,” he said. “We’re not a high risk area, unlike anyone working in any kind of retail right now.”

This story was originally published April 12, 2020 at 11:55 AM.