COVID-19’s Potential Lasting Impact On Fixed Vs Variable Hotel Expense Ratios – By Mark VanStekelenburg, Kannan Sankaran, Andy Hartley and Vanessa Gonzalez

As a result of COVID-19, hotel operators have been forced to make tough decisions, including the most basic one on whether to keep the lights on. Many were required to close their doors after municipal mandates were put in place and some decided to remain open, despite record-low occupancy levels, to house pandemic-related first responders and other essential personnel related to the fallout from the spread of coronavirus, largely in place of more traditional sources of demand during 'normal times'. Depending on the type of hotel and its service level, the decision to close or remain open varied across markets.