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Cleveland hospitality businesses suffering through coronavirus, with hope for future events

NFL Draft gives hotels a reason to be hopeful
Downtown Cleveland
Posted at 4:12 PM, Oct 27, 2020
and last updated 2020-10-28 19:00:10-04

CLEVELAND — There are reasons to be optimistic in Cleveland’s hospitality industry despite months of much less business than normal because of the coronavirus pandemic.

In 2019, Destination Cleveland "announced that 19.6 million people visited Cuyahoga County in 2019 for business and leisure travel, representing a 2.1 percent increase over 2018 and a 31.5 percent increase since 2011," a news release states. "Travel and tourism in Cuyahoga County accounted for nearly $6.4 billion in direct sales and a total economic impact of $9.7 billion."

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Before COVID, Cleveland was beating the national average in new visitors welcomed to the region.

"We also showed that we were on track to exceed our goal we set five years ago, a pretty hefty goal, of having 20 million visitors a year by 2020," said Destination Cleveland President and CEO David Gilbert. "Obviously, now we're not going to hit that this year."

The coronavirus might be a big obstacle keeping that trend from continuing, but Gilbert says the long list of future events could help the city bounce back.

The NFL Draft is scheduled to be in Cleveland in 2021, the NBA All-Star Game is slated for 2022, and the NCAA announced a long list of events in and around Cleveland from 2024 - 2026.

2024

  • NCAA Division III Baseball Championship, North Coast Athletic Conference at Classic Park
  • NCAA Division II Men's and Women's Swimming and Diving Championships Finals at SPIRE Institute - Aquatics Center

2025

  • NCAA Division III Baseball Championship, North Coast Athletic Conference at Classic Park
  • NCAA Division I Men's Basketball Championship First and Second Rounds Mid-American Conference at Rocket Mortgage FieldHouse
  • NCAA Division III Men's and Women's Outdoor Track and Field Championships at SPIRE Institute - Outdoor Track & Field

2026

  • NCAA Division III Baseball Championship, North Coast Athletic Conference at Classic Park
  • NCAA Division I Wrestling Championships at Rocket Mortgage FieldHouse
  • National Collegiate Women's Bowling Championship at RollHouse Wickliffe

The main issue for many hospitality businesses in Cleveland is making sure they’re still around to host visitors for those events.

Downtown Cleveland
Downtown Cleveland on March 17, St. Patricks Day, shortly after Ohio's shutdown orders went into effect. What would normally be streets filled with people enjoying the holiday were completely empty.

STR is a company that tracks how many people are staying in hotels and what they’re paying across the globe. In Cleveland, STR’s data show hotel occupancy in Cleveland was down between 40 and 67 percent depending on the month from March through August with visitors paying about a third less than they would have in 2019.

Those data explain trends at larger, more traditional hotels across the Cleveland market, but The Cleveland Hostel owner Mark Raymond says he’s seen a similar trend in his Ohio City space.

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The 15 rooms that can hold up to 60 people at The Cleveland Hostel were completely empty because of the coronavirus in April.

“In July and August, we did about a third of normal business, maybe a little less,” said Raymond. “You had the marathon get canceled and the next day, we’d get cancellations here. The Rolling Stones get canceled, the next day, bam.”

While large hotel chains have plenty of resources to overcome the pandemic, smaller businesses like The Cleveland Hostel have to rely on programs like the Paycheck Protection Program (PPP). Raymond says The Cleveland Hostel got PPP money and is working through the process to get that loan forgiven.

Rocket Mortgage FieldHouse
Rocket Mortgage FieldHouse shines bright to say thank you to all the frontline workers. Since the renovation was completed, it's had few chances to host major events because of the coronavirus.

“They don’t have the big resource of major chains and a lot of the big, fast, fresh types of restaurants,” said Gilbert.

The light at the end of the tunnel, at least in the short-term, could be the NFL Draft scheduled for Cleveland in April.

“What’s being planned is a large-scale, live event,” said Gilbert.

Nashville officials estimate 200,000 people filled downtown for Round 1 of the NFL Draft
Nashville officials estimate 200,000 people filled downtown for Round 1 of the NFL Draft in 2019. Cleveland's 2020 version will likely be much different.

Gilbert says the plan for the draft still includes having an in-person, outdoor fan area reaching from First Energy Stadium and the parking lot to the north of the stadium all the way east through North Coast Harbor.

Timed ticketing, social distancing, and being outdoors, Gilbert says, gives them a chance to pull it off.

“Obviously, so much depends on what the world situation looks like six months from now and what the state allows, what the county allows, what the city allows, and so on,” said Gilbert.

social distancing outdoors
Signs posted at Edgewater encourage people to practice social distancing even when outside.

He says it likely won’t be the $100 million windfall that the NFL Draft has been for other cities, and that lost money for Cleveland is lost revenue for businesses like The Cleveland Hostel.

“By next summer, things will have to turn around,” said Raymond.

The Ohio Hotel and Lodging Association tells News 5 that just within Ohio, “29,700 employees of hotel and lodging businesses were displaced at the height of the closures,” and, “16,166 of those jobs are still lost as of Sept. 2020.”

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Gilbert expects more information on the NFL Draft plans in Cleveland to come out after the Super Bowl.

Ohio Hotel & Lodging Association Executive Director Joe Savorise tells News 5 that room tax shortfalls could have lasting impacts on local governments.

“Prior to the pandemic, Ohio hotels supported 192,000 total jobs and paid $2 billion in taxes directly,” wrote Savorise in an email.

That room tax funds Destination Cleveland, which means decreased travel and hospitality business also impacts the organization tasked with attracting events to fill hotel rooms.

Gilbert tells News 5 the pandemic has lead to Destination Cleveland cutting a little less than half of its 65-person staff. Despite that, he said other similar organizations have had to make even larger cuts.

He says he expects the industry to recover in 2023 or 2024.

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