Hotels in Major Cities Like Houston Still Struggling to Stay Open

Houston hotels are struggling to keep up with their mortgages payments.

Even as parts of the country loosen COVID-19 restrictions, hotel delinquencies are rising in major cities like New York, Los Angeles and Houston. The occupancy rate in the Houston area is only 37 percent. That's better than May’s reported 10 percent, but not enough to keep the doors open in the long run. Justin Bragiel, General Counsel at the Texas Hotel & Lodging Association, says it's the larger hotels that are most at risk of closing permanently.

“A lot of times they have less flexibility with their lenders that’s a large loan. Primary source of revenue is not likely to return anytime soon. So think about a big downtown hotel next to a convention center. That’s a hotel that’s really struggling right now,” Bragiel said.

As an example, Bragiel notes Omni’s plan to sell off hotels in Texas and Florida.

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