How Is Covid-19 Impacting Life in Your City?

[mhays]

We know outdoor transmission risk is low, but we don't know how low.

In any case, a hypothetical 0.001% risk (made-up number) is still worth addressing when multiplied by hundreds of occasions. And the risk is much higher at four feet than eight feet.

[JManc]

Basically it comes down to best judgment. Mask or no mask, crowded areas are more risk prone and this is the main reason I have avoided crowded areas indoors and outdoors. It's one thing if you have no other choice and live/work in this environment but I am not going to go out of my way to visit Times Square anytime soon.

My wife and I are taking a road trip next week and are avoiding urban areas for the most part and just doing outdoor activities. Here at home, I workout at times when there's virtually no one else around. If I can't see another person around, there's no need to wear a mask.

[Pedestrian]

Originally Posted by JManc

Because there's no need to in most cases. Yes, if you're in a crowded urban area with less than 6' between you, it makes sense to wear one but walking through the parking lot or out for a walk, no. Again, people are wearing them alone in the car. Not necessary.

I think your perspective is different than a center-city dweller. The parking lot example is a give-away. Since I don't have a car in the city, parking lots don't apply.

This is essentially my outdoor experience--a lot of these early scenes including the farmer's market are quite near where I live--and I wear a mask and wish everyone did:

• Video Link

[iheartthed]

The hotel closure wave is gaining steam. I didn't see this posted before, but the Hilton Times Square will close on October 1:

Closure of Hilton Times Square may be ‘tip of the iceberg’ of troubles facing New York hotels

This week’s announcement of the permanent closure of the iconic 44-story Hilton Times Square hotel in the heart of New York City was a wake-up call for the embattled hospitality industry, especially in urban markets suffering from a coronavirus-driven tourism drought.

The move follows a decision earlier this week by Ashford Hospitality to hand over the keys to its recently purchased Embassy Suites in Midtown West to its lender after the real estate investment trust fell behind in debt payments.

In fact, 34% of hotels in New York City alone are currently delinquent, and hospitality investment bank Robert Douglas sees more hotels at risk of closing.

“Most hotels are using capital reserves to help cover interest payments in the near term and the vast majority of hotels in New York City have missed debt service coverage tests that will result in cash flow sweeps and will limit the ability, absent lender agreement, to get loan extensions that would normally be automatic,” said Doug Hercher, managing director and principal at Robert Douglas. “This is the tip of the iceberg.”

Fourteen New York City properties with loans in the commercial mortgage-backed securities universe are 60 days or more behind payment, according to database of securitized mortgages Trepp. Tracking individual loans, the Standard Hotel in the Meatpacking District, the Holiday Inn in the Financial District and Tryp by Wyndham Times Square South are among the properties that have defaulted.

A large number of these hotels are located in and around Times Square and Midtown, neighborhoods in New York City that typically draw thousands of tourists and are popular places to stay for business travel.

Broadway is always a natural draw for international tourists, and staying at a hotel nearby is often part of the experience. But with shows not expected to return to the Great White Way until next year, hotels near the biggest theaters remain nearly empty.

https://www.cnbc.com/2020/09/04/hilt...rk-hotels.html

[suburbanite]

We recently did some due diligence on a lender with serious hotel exposure across the U.S. and Canada. The numbers were frightening. Over 85% of loans were classified as payment in kind by May, and with no sign of occupancy recovering enough in the next year, there's going to be a massive number of defaults.

[mhays]

Hotels are one category where business owners are going to be eaten alive, but I'd guess consumers (guests) won't get hit that much. Other buyers will swoop in and most hotels should be back open during the vaccine ramp-up or soon after.

If you disagree, I'd love to hear why.

[suburbanite]

Hotel's aren't really my game but I think it depends on the type of asset. Those relying on business travel should (and already have to some extent) recover faster. They're also treated as more of a commodity that can easily trade hands to a new owner/branding with little disruption. I'm sure the airport Marriot will survive in some form.

The luxury market is obviously less liquid, and the readiness of capital to dive back in to a business that is difficult in the best of times isn't really apparent. The Downtown ones at least have the benefit of sitting on prime real estate. You have to wonder if a bunch of properties are taken over by creditors, that they may have to push for alternative uses to get them off their hands quickly. Obviously it's going to be a difficult market for multiple high-end downtown hotels to sell at the same time, each operating at 10% capacity. Maybe we see a consolidation to a much lower number of total rooms in some areas until long-term demand returns.

The worst hit though are the resort type properties. One's relying on a healthy amount of domestic and international tourism. Boutique places in somewhere like Napa Valley that are the result of some individual's vision and hard work. These are a lot harder to easily switch over to a new operator. A couple of these types of properties in the file I looked at were already being prepared to be taken to market as vacant land essentially. Won't be a quick restructure and back to business once a vaccine is available. I'd say the consumer loses out here or any time the selection and competition faced by larger brands is diminished.

[Crawford]

Hotels won't be fully back till 2022. That's a rough asset right now. Eventually they'll be fine, but there's no fix absent normalcy.

[TWAK]

I think there will be a post vaccine surge, and I for sure am gonna surge to all my relatives who are really old!

[SIGSEGV]

some hotels are being used as temporary dorms by universities, although given that a lot of universities have sent their students home anyway, hard to know how well that will work.

[LA21st]

Originally Posted by the urban politician

I’m sick of people wearing masks incorrectly.

Having it covering your mouth but not your nose is NOT THE CORRECT WAY to do it here, folks. Might as well just not wear it at all

I don't get it either. It's so stupid.

[LA21st]

Originally Posted by JManc

Unless you're built like the Rock, confronting some idiot without a mask is asking for trouble. It's just not worth it and people have been hurt (including store workers) demanding customers wear their masks correctly. Not sure about other states but here, workers no longer confront those without them on for their own well-being. We've stooped that fucking low.

I am more referring to those virtue signalling with the selfies and feeling like everyone needs to wear one the moment they walk out their front door and if they don't they are knuckle-dragging Trumpers. I wear one inside any business and avoid going out as much as I can but I will not wear one outside.

People have been shot or stabbed I believe. dont do it.

[10023]

Originally Posted by mhays

We know outdoor transmission risk is low, but we don't know how low.

In any case, a hypothetical 0.001% risk (made-up number) is still worth addressing when multiplied by hundreds of occasions. And the risk is much higher at four feet than eight feet.

No it isn’t.

[Pedestrian]

Originally Posted by suburbanite

Hotel's aren't really my game but I think it depends on the type of asset. Those relying on business travel should (and already have to some extent) recover faster. They're also treated as more of a commodity that can easily trade hands to a new owner/branding with little disruption. I'm sure the airport Marriot will survive in some form.

The luxury market is obviously less liquid, and the readiness of capital to dive back in to a business that is difficult in the best of times isn't really apparent. The Downtown ones at least have the benefit of sitting on prime real estate. You have to wonder if a bunch of properties are taken over by creditors, that they may have to push for alternative uses to get them off their hands quickly. Obviously it's going to be a difficult market for multiple high-end downtown hotels to sell at the same time, each operating at 10% capacity. Maybe we see a consolidation to a much lower number of total rooms in some areas until long-term demand returns.

The worst hit though are the resort type properties. One's relying on a healthy amount of domestic and international tourism. Boutique places in somewhere like Napa Valley that are the result of some individual's vision and hard work. These are a lot harder to easily switch over to a new operator. A couple of these types of properties in the file I looked at were already being prepared to be taken to market as vacant land essentially. Won't be a quick restructure and back to business once a vaccine is available. I'd say the consumer loses out here or any time the selection and competition faced by larger brands is diminished.

I read the investment press, not the hotel industry press, but I believe I've read exactly the opposite view on several occasions: That the discovery that ZOOM could suffice for in-person business meetings has meant that business-oriented hotels might suffer the worst; perhaps not right away but eventually because eventaully tourism and liesure travel will return to "normal" but business travel may never be the same.

Anyway, add to the list of dead hotels:

1. Mariott's 452-room Times Square Edition: As New York Reopens, Many of Its Hotel Rooms Look Closed for Good


From above link

2. Chicago's famous Palmer House: Grand Chicago Hotel in Foreclosure, a Symbol of Covid-19’s Toll on Hospitality Industry


From above link

[Pedestrian]

Originally Posted by Crawford

Hotels won't be fully back till 2022. That's a rough asset right now. Eventually they'll be fine, but there's no fix absent normalcy.

NOBODY but you thinks they'll ALL be "fine".

As many as 25,000 rooms, or 20% of New York’s total, might not reopen, analysts and hotel owners say. That is equivalent to the entire size of hotel markets in Louisville, Ky., or Jacksonville, Fla.

“Covid…was the final nail in the coffin,” for these New York properties, said Lukas Hartwich, an analyst with Green Street Advisors who follows the lodging industry.

https://www.wsj.com/articles/as-new-...od-11592308800

[Crawford]

Originally Posted by Pedestrian

NOBODY but you thinks they'll ALL be "fine".

Yes, they do. These major hotels will all be reflagged with new brands. People will start traveling once there's a vaccine.

In fact, one of the hotels you just posted (the Times Square Edition) was already reflagged, days after closing. It will remain an Edition, but under revised ownership. It's opening in a few days, actually. That asset is probably one of the most valuable hotels on earth, given its location.

https://therealdeal.com/2020/07/14/t...-debt-dispute/

The other hotel you posted, the Palmer House Hilton, had like $250 million poured into it a few years ago. It's a very valuable asset, and I bet will be reflagged before end-of-year.

You really believe that people will stop traveling, essentially forever? I have about a dozen planned work trips that will occur in the first few months of normalcy, as well as leisure trips planned to Europe and Mexico. Yes, the economy will remain horrific for a few quarters, yes some will be wary to travel for a few quarters, but people ultimately won't stop needing travel and human interaction.

[Steely Dan]

Originally Posted by Pedestrian

2. Chicago's famous Palmer House: Grand Chicago Hotel in Foreclosure, a Symbol of Covid-19’s Toll on Hospitality Industry


From above link

The WSJ needs better fact checkers.

That's an image of the 2nd palmer house hotel that was built on the site of the original hotel that was destroyed in the great chicago fire 150 years ago.

The 2nd version pictured above was in turn demolished in the 1920s to build the much larger and current version of the hotel pictured below.



Source: https://www.hpzs.com/portfolio-view/...-house-hilton/

[the urban politician]

The current Palmer House Hilton in Chicago is an absolute gem. The lobby is.........just majestic.

It's a must that this property be preserved and kept alive for its intended use as a hotel

[LA21st]

Wow. I love that hotel.

[suburbanite]

Originally Posted by Pedestrian

I read the investment press, not the hotel industry press, but I believe I've read exactly the opposite view on several occasions: That the discovery that ZOOM could suffice for in-person business meetings has meant that business-oriented hotels might suffer the worst; perhaps not right away but eventually because eventaully tourism and liesure travel will return to "normal" but business travel may never be the same.

Long-term is different. At this point, talk about the effect of WFH policies on office space demand, conference centers, business travel, etc. is pure speculation. I was more just referencing the fact that the only hotels I saw spinning off any cash flow to pay down debt were the main airport/business travel brands.