July/August 2020

and we started seeing the shutdown of economies globally,
we had limited clarity on how severe the issue was and how
long we would be shut down,” said Pirani. “What’s transpired
since that time has been beyond everyone’s initial expectation.
The restrictions on business activity and travel have caused a
tremendous impact across all market industries — especially in
the hospitality business. The drop in occupancy has imposed
unprecedented challenges, not only to hotel owners and
operators, but also to investors and lenders.”
The panel addressed three broad themes — real-time performance
and market outlook; liquidity; and a look into the
capital markets to address valuation in investor sentiment and
availability of capital.
“It’s 90 days later and the first thing we can say is we
survived,” said Russell. “I’m not sure too many of us would
want to have repeated those 90 days, but we’re here today. [At
the time of] the original call on March 31, we weren’t at the
bottom. We hit bottom the week of April 11 — that was the
worst week we have on record for Canadian occupancy, which
was 12 per cent occupancy for that week for the hotels that
were operational. And according to STR, close to 20 per cent
of the rooms in the country were shut down. ADR bottomed
out at about $101, down from $155 in early March. So, we
went from a $155 rate to a $101 rate and stayed at that rate for
about seven weeks. Now we’ve had a turnaround. We’re about
10 weeks into a recovery and last week occupancy was 25.6 per
cent for the country with an ADR of almost $111. We’re still
Bunn_FoodserviceHospitality_Spring2020.pdf 1 2020-02-13 9:19 AM
off in terms of RevPAR by almost 79 per cent, but that’s down
from the decline of our lowest RevPAR decreases, so we’re
moving back into a positive direction.”
She pointed out that no province was spared and no region
was immune to this downturn. The performance and the
numbers in B.C. were a little bit higher than the averages,
while Newfoundland ended up being at the bottom in terms
of overall performance. “But really, we’re talking about a difference
between 10- and 20-per-cent occupancy. So, nobody was
operating at levels that were profitable or productive.”
But, she added, the question remains, “how long until we start
to see some of the other forms of travel and convention business/
business travel that makeup of base of what we’re doing? ”
Given that we’re starting to see some of the markets open
up, Pirani asked the owners on the panel what they’re seeing
with their current portfolio and how they see the recovery
process unfolding.
“We see a little bit more traction in our limited-service
hotels and secondary and tertiary markets,” said Gibson. “So,
while we’re not setting the world on fire, we see a little bit of
demand pick up in those hotels, where we thought we would
see additional traction and we haven’t gotten it so far is in our
[two] resorts. Once the province started opening additional
services, our other business really picked up — golf, spa and
our winery business. But we haven’t seen the traction in the
rooms business yet. It’s coming. Our view is that the recovery is
going to be a little bit protracted and the real question is how
TM