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Published in Small Business

Suburban Inns ‘hanging on by our fingertips’

BY Sunday, May 10, 2020 06:20pm

HUDSONVILLE — Nearly all of Suburban Inns Inc.’s more than 1,000 hotel rooms in West Michigan are sitting empty.

Faced with that situation, the company is in “survival mode,” according to Bill Lucas, vice president of hotel operations at the Hudsonville-based company. 

“It’s not even a drop in the bucket: The faucet turned off; it’s basically just dripping,” Lucas said. 

All seven of Suburban Inns’ hotels in the greater Grand Rapids and Holland areas are functioning at between 6-12 percent occupancy. 

“To put that in perspective, at the Embassy Suites (in downtown Grand Rapids), you’re talking a 250-room hotel that’s selling anywhere between nine to 15 rooms a night,” Lucas said. “To say we’re hanging on by our fingertips is just that.”

The company completely closed its Holiday Inn of Midland because of the hotel’s dependency on global business travelers to The Dow Chemical Co., he added.

Global travel restrictions and travel bans related to the outbreak of COVID-19 started affecting business at Suburban Inns’ properties in January. Ensuing bans on group gatherings and stay-at-home orders escalated the crisis and affected all facets of the company, including the company’s Big E’s Sports Grill and Sharkee’s Bar and Grill restaurants.

“First, we watched Fortune 500 companies, the bigger name-brand companies, ban travel. Around mid-February, then the local companies started really pulling back,” Lucas said. “From there, it became the leisure travelers, and then it just fell apart.”

Spring and summer festivals and concerts were canceled. Banquet and conference room reservations were abandoned. 

“The weddings, the bridal showers, the baby showers, the award ceremonies — all of that just disappeared,” Lucas said. 

In response, Suburban Inns laid off 90 percent of its workforce, although the company is still paying for employees’ health insurance with the help of the Paycheck Protection Program.

“We fully expect to bring them back,” Lucas said. “At what pace will they be brought back? That is dictated by the business.” 

For now, the company’s properties — which operate as essential businesses — are working “off a skeleton crew” of mostly management and department heads, he said.

The guests of the hotels are mostly frontline workers who are traveling to help staff hospitals and nursing homes, according to Lucas. They have little to no interaction with hotel staff. Linens are picked up and dropped off from the hallways, breakfast is grab-and-go, and guests enter with digital keys downloaded to their smartphones. 

“They might wave to us at the front desk, but then they go upstairs,” Lucas said. 

The buffets, pools, spas and gyms at the hotels were closed by state mandate, and Lucas is hesitant to predict when those amenities will be safely back in operation. 

“It’s a level playing field for everybody in the hotel business right now because none of that is open, none of that is available,” he said. “You take away that amenity from everybody, what do you have to offer?” 

Even when travel and hospitality business begins to resume some normalcy, amenities like buffet breakfasts might permanently wind up a relic of the past, he said. 

“You really don’t know what’s going to be next,” Lucas said. “In my opinion, a lot of people have been staying at home and missed a lot of vacations. Maybe they’ll want to get out and venture out again. When they do, their expectations are going to be pretty high. They’re going to want to visit somebody that’s clean and healthy and respecting what they’re desiring. We’re just trying to try to stay on top of that.” 

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