Hotels

Regina hotels struggling in third calendar year of COVID pandemic

According to the Regina Hotel Association, approximately $162 million has been lost by local hotels since the pandemic began.

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Not much is happening in Regina in January and what little was planned for the winter has been dropped in the face of the fifth wave of COVID, which is bad news for hotels in the city.

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Glenn Weir, owner and general manager of SureStay Plus Hotel By Best Western Seven Oaks, said the cancellation of sports tournaments, business events and banquets has been difficult for hotels.

“We are still in recovery mode in the hospitality industry, largely due to the lack of events in Regina,” Weir said.

Weir said most hotels have pinned their hopes on the Saskatchewan Winter Games, and for Weir in particular, rooms have already been booked for the tournament. Meanwhile, for a hotel with waterslides that hosts events like birthday parties, Weir has noticed that people are uncomfortable being out in public with too many people.

“We’ve seen the fact that Omicron is forcing people to stay away from large public gatherings,” he said. Often on weekends when people are looking to book rooms for pool access, Weir has received a number of calls asking how busy he will be.

“We get a few phone calls that say, you know, basically, we don’t want to be there if you’ve got quite a few rooms booked,” he said.

“They don’t want to go to a crowded place.”

While people were still learning to pronounce Omicron in December, Weir saw an immediate impact on bookings, as 10-15% of reserved rooms were cancelled.

Tracy Fahlman, president of the Regina Hotel Association, said her organization will return to city council to seek the 25 per cent hotel property tax exemption this year. According to the city administration, the current recommendation, which should be presented to the executive committee on Wednesday, is to reject this proposal.

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“Regina’s hospitality industry was decimated and it continues to struggle today,” Fahlman said.

In 2021, hotels in Regina saw an average occupancy rate of 34%, Fahlman said, compared to 30% in 2020. The pre-pandemic average was 60%. According to his organization’s account, about $162 million has been lost by hotels in Regina since the pandemic began.

“Hotels were the first affected and will no doubt be the last to recover. There is a real threat that the hospitality sector would not have survived until today without sustained access to government assistance programs,” Fahlman said.

Right now, Fahlman said hotels are “hanging by a thread.”

Jim Bence, president and CEO of Hospitality Saskatchewan, said in some rural communities, hotels and motels are doing well, where hockey tournaments are taking place, and where oil fields and other passing workers are here. Taverns and sales are also a boon for small town hotels, but overall hotels in Saskatchewan are suffering.

With the new wave in Saskatchewan and around the world, things have moved back online and events, banquets and conferences have moved to Zoom and Microsoft Teams.

“Big hotels cater to the corporate world. So they are the ones who depend on meetings, conferences, trade shows, events to happen,” Bence said. “It’s worse than last year at this time.”

Fixed costs such as electricity, gas, salaries, insurance, mortgages and especially property tax represent a significant part of the hotel’s general costs. Bence says with declining occupancy, a number of hotel owners are scratching the bottom of the barrel to make payments.

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“When tourism takes a hit, which the whole industry takes, then all of those businesses that support business really suffer,” Bence said.

Bence, Fahlman and Weir all said that without continued federal assistance and local relief, chances are many hotels have already closed.

“We need it. Our income has gone down so much,” Weir said. “It’s very thin right now.”

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