While government workers and contractors have been stuck at home during the government shutdown, hotels around the area are hurting due to a large decrease in visitors.
Hotel occupancy rates have dropped steeply because the shutdown has meant a trifecta of key travelers have cancelled trips, B.F. Saul President Mark Carrier said. B.F. Saul owns the Crowne Plaza and Holiday Inn in Crystal City and 13 other hotels in Northern Virginia.
Government workers and contractors that would have traveled here for business are canceling reservations, as are visitors with their families and large tour groups concerned they won’t be able to see key monuments and museums in D.C.
“The decline has been quite severe and very impactful,” Carrier told ARLnow.com. “The reality in the hotel business is when you lose business today, it’s gone. October is the strongest month in the second half of the calendar year, so to have this occur right in October is particularly harmful.”
Carrier said the typical occupancy rate in B.F. Saul hotels at this time of year is between 75-80 percent, and estimates that since the shutdown started, it has dropped to around 50 percent. As of Wednesday afternoon it appears Congress is close to a deal to end the shutdown, but Carrier said that doesn’t mean relief is necessarily on its way.
“I expect we’ll see significant effects from this,” he said. If contractors have lost revenue because of the shutdown, “one of the things they cut back on is travel. It seems to be an expense you can say ‘no’ to.”
Carrier said some hourly staff and supervisors have had their hours cut into to try to offset the hotel’s declined revenue, which he called “very painful” as a hotel operator. If the shutdown deal falls through and the Marine Corps Marathon is cancelled, the effects could be even worse. Carrier said his hotels, and many others in Arlington, are usually close to 100 percent occupancy rate during race weekend.
The steep drop in revenue could have impacts for Arlington County’s planned transportation projects as well. The Transient Occupancy Tax — commonly known as the hotel tax — helps pay for the funding in last year’s transportation package, and will take a hit from the drop in hotel visitors.