For many smaller hotel operators, surviving the pandemic meant leaning into the unique advantages of having a more limited portfolio, including the ability to quickly adapt, stay nimble, engage with property-level teams, and maintain transparent, direct communications. LODGING recently spoke with Barbara Purvis, president of Essex Hotel Management, a management company based in Rochester, N.Y., that has been active in the hospitality space for more than three decades, starting with a single Microtel and since growing to a portfolio of 12 hotels under various Hilton and Marriott brands that stretch from New York to Florida. Purvis shared her experience navigating the pandemic, challenges the company endured, and her predictions for the next few months.
How has your portfolio been affected by the COVID-19 pandemic?
It was very tough; we had to postpone some hotel openings and renovations for a period of time and we had to lay off 80 percent of our workforce, which was very painful. We then had to try to figure out the PPP program, because all of that was evolving. I do not consider myself a political person, but I was reaching out to members of Congress, senators, and anybody who could help.
On top of that, we are a small company. All of our revenues are tied to our hotels and so, fortunately, while we did not have to lay off any of our corporate staff, we initially took some significant pay reductions until we knew how the PPP program was going to work. After that, we were able to restore most of them. For the first few months, I wondered if we were going to keep the lights on.
I think a lot of companies went through that, especially the small ones. We pride ourselves on our flexibility, nimbleness, and accommodation. But you can also see the fragility in a small size when these events happen because you don’t necessarily have that money tree just sitting in the bank account.
You mentioned having to lay off 80 percent of your workforce. How many have you been able to bring back?
We brought back many folks, but not all of them. For many, they didn’t want to be in a hotel due to the risk of COVID-19 exposure or with schools going virtual they needed to stay home, so recruiting for us has been very challenging. Like every other business, we had to increase base wages. We’ve done signing bonuses, retention bonuses, and referral bonuses. It’s mainly the line staff that is difficult to recruit, but recently we’ve been facing some general manager burnout as well. It’s tough for them—they’re now doing housekeeping, working the front desk, and often getting berated by guests. It’s important for us to continue to be there for them and be available to listen and not just give them some spiel; everything is an individual situation. Going back to being a smaller company, we have the luxury of being able to respond individually.
It’ll be interesting to see how these staffing challenges play out over time. I think the hospitality industry recognizes that it’s no longer a reliable employer. Getting back people and retaining them means, for instance, creating more flexible schedules that are more feasible for them.
How is Essex Hotel Management performing currently?
Depending on the location, our hotels started to see strong occupancy from leisure travel in the summer of 2020. Others that were more corporate-reliant were still on the lower side. It was very mixed, but this year things are much better and particularly those hotels in strong leisure environments have seen numbers near or exceeding 2019 levels. Things are looking up and there is more optimism. These next few months will be challenging in some markets for some properties, so we are preparing ourselves for some of that uncertainty.
There’s still a lot of uncertainty but we are in a much better position than we were a year ago. Having effective vaccines roll out quickly has made a tremendous difference. I don’t know what “normal” is, but we are heading in the right direction and growing the company. We’re all energized by the shift from surviving to thriving.
What do you expect demand will look like over the next few months?
Because we are located in multiple states our markets are very different, we have to look at each of our properties individually. For example, we have a Hampton Inn & Suites in Lake Placid, N.Y., that has done exceptionally well, and now our general manager needs to be prepared for what we believe will be some strong demand in the next month or two, although we don’t necessarily have the full team in place. In other markets, it’s been encouraging to see corporate business start to return.
There has been an influx of M&A activity in the hotel management space. Is Essex Hotel Management considering any M&A opportunities?
That was one of things we looked into a year ago. Considering our size we talked to some groups, but nothing got very far. Some of the M&A activity that we are seeing has created some very large organizations and that’s not always the right answer for a large segment of owners.
What makes Essex Hotel Management unique?
We are a very engaged organization with our owners, partners, and hotel teams. Our team is always visiting our hotels and communicating with them. That level of engagement creates a sense of community and also drives performance. There is a high degree of transparency within our company, and owners are able to talk to whoever they want in the company. There is not a lot of stratification and hierarchy. For many owners, having that connection is important.
Our size right now is a benefit. You need to be able to adjust, react, and respond. Too many “this is the way we do it” scenarios create miscommunication and dissatisfaction. There’s a lot going on simultaneously—staffing and workforce challenges, changing market conditions, and simply being prepared for the unknown where you need to be on your toes. I think it’s easier for smaller companies to successfully navigate and manage all that.
