Roughly six months into the Covid-19 pandemic, more than two-thirds of U.S. hotels remain at or below 50% occupancy, according to the new "State of the Hotel Industry" report from the American Hotel & Lodging Association (AHLA).
The report also indicates that consumer travel remains at an "all-time low," with only 33% of Americans reporting that they've traveled overnight for leisure or vacation since March and just 38% saying they are likely to travel by the end of the year.
For the upcoming Labor Day holiday weekend, hotel bookings are down 66% compared with the year prior.
"While hotels have seen an uptick in demand during the summer compared to where we were in April, occupancy rates are nowhere near where they were a year ago," said AHLA president and CEO Chip Rogers in a statement. "We are incredibly worried about the fall and what the drop in demand will mean for the industry and the millions of employees we have been unable to bring back."
The AHLA estimates that around four in 10 hotel employees are currently not working and that around 65% of U.S. hotels are operating below their breakeven point.
"Thousands of hotels can't afford to pay their mortgages and are facing the possibility of foreclosure and closing their doors permanently," said Rogers.
Among those at highest risk of defaulting are urban properties, which have been hit harder by the crisis than hotels in nonurban locations. According to the AHLA's report, urban hotels are seeing occupancies hover at the 38% level, versus a nationwide average of roughly 48.8% occupancy for August.