Half of Ottawa hotels now closed in wake of COVID-19, industry group says

Steve Ball
Steve Ball is the president of the Ottawa Gatineau Hotel Association. File photo

In a typical year, guest traffic at Ottawa’s largest hotel is a lot like the city’s normal economy ​– steady and predictable.

Located within shouting distance of major attractions such as the ByWard Market, Rideau Centre and Rideau Canal and practically joined at the hip with the Shaw Centre and the thousands of conventioneers it draws each year, the 492-room Westin Ottawa typically boasts an occupancy rate hovering around 80 per cent.

But as everyone knows, 2020 has hardly been a typical year. With the COVID-19 pandemic decimating the tourism industry and scuttling conventions and other major meetings, there’s plenty of room at the marquee downtown hotel right now. 

Tuesday afternoon, Westin general manager Ross Meredith estimated fewer than 50 suites were occupied – some by people left stranded after international flights were cancelled, a few others filled by homeowners waiting to move into new digs.

“It’s sort of a hodge-podge of a little bit of this and a little bit of that,” said Meredith. “At the end of the day, we’re here to support whatever needs there are, and try and keep a few (employees) busy and keep some payroll going. We’re hanging in there, but certainly business is slow – no doubt about it.”  

With nearly 400 employees, the Westin has one of the largest payrolls in Ottawa’s hospitality industry. But there’s currently only enough work for eight to 10 people on any given day, a far cry from the 60 who would normally be on site.

“Really, the revenue coming in is just barely covering the cost of the operating employees,” Meredith said.

The same bleak picture is being painted at hotels across the region. 

Steve Ball, president of the Ottawa Gatineau Hotel Association, said about half of his organization’s 60 member properties have closed their doors since the Ontario government ramped up measures to control the spread of the novel coronavirus – including major hotels such as the Château Laurier and the Lord Elgin.

Overall, Ball estimates about 50 of the region’s 100 or so hotels have shut down since the COVID-19 outbreak began, and even those that are still open have seen vacancy rates plummet into the single digits.

Even worse, the veteran tourism executive said, there’s a “very real” concern that some of those properties will never reopen. With major tourist draws such as the Ottawa Jazz Festival already called off, the stream of visitors that represents a lifeline for many smaller, independently owned lodgings is poised to slow to a trickle in the summer of 2020.

“If you don’t have access to liquidity or the ability to finance months of no revenue, then there is certainly that risk,” Ball said in an email to OBJ.

As part of the multinational Marriott conglomerate, the Westin isn’t in the same precarious financial position as many smaller properties. But Meredith said he feels for hoteliers who are still forced to pay for fixed operating costs such as mortgages, property taxes and utilities even when they’re generating zero income.

“You need to have some fairly deep pockets to be able to last out multiple months of those costs,” he said. “I think what scares a lot of people is moving those costs just farther down the road only makes it more difficult for future cash flow and makes it more difficult to sort of see a light at the end of the tunnel.”

Meredith remains optimistic that the COVID-19 crisis will abate sooner rather than later and meeting and convention traffic will slowly resume. Still, he said if physical distancing measures and business closures continue for months on end, the impact on the bottom line will be hard to ignore.

“That’s the part that makes us a little bit nervous going forward,” he said. “When do the large groups and large conferences get excited about coming back and meeting again?”  

Ball said it’s anybody’s guess when the industry will rebound.

“Nobody can predict what recovery will look like or when that might begin to happen.”