The city of Chicago plans to rent thousands of hotel rooms to be used for people diagnosed with the new coronavirus or those who believe they’ve been exposed, in an effort to stop the spread of the virus and relieve the burden on hospitals.
By Tuesday, the city will have more than 1,000 rooms in a combined five Chicago hotels available to isolate people who are mildly ill with COVID-19, who fear they’ve been exposed, and for those who are awaiting test results. The city already has an agreement to rent rooms in the 215-room Hotel One Sixty-Six Magnificent Mile, formerly a Cambria hotel.
By the end of this week, there will be more than 2,000 hotel rooms available, Mayor Lori Lightfoot announced at a Monday news conference.
“People in Chicago are stepping up and rising tall in this moment,” Lightfoot said.
In addition to helping on the health care front, the effort will provide a source of revenue and continued employment for the hospitality industry, which has been hobbled by travel restrictions and the growing number of cases.
The number of hotels wanting to be part of the program “is growing by the hour,” Michael Jacobson, CEO and president of the Illinois Hotel & Lodging Association, told the Tribune.
“Statewide, we’ve already identified over 12,000 rooms,” Jacobson said. “This morning I’ve gotten five or six new hotels that have volunteered. They’re answering the call to action and they want to be helpful to the city and the state.”
People will be referred to the city-controlled rooms by the Chicago Department of Public Health. Lightfoot’s office said it will secure “competitive rates” of about $175 per night, including three meals, paid for upfront by the city.
The cost to the city will be substantial — Lightfoot estimated the cost to use just one hotel will be about $1 million per month.
The city said it plans to seek reimbursement from federal funds and other potential sources.
“By no means is this going to make a hotel money,” Jacobson said. “But if it can at least help them weather the storm when it comes to paying property taxes and maintaining at least a few staff without having to layoff 100%, the hotels see that as an opportunity to try to take care of their employees.”
The program is likely to be expanded to include hotel rooms for use by hospital workers who are exposed to coronavirus patients and wish to stay away from home in order to avoid infecting family members, according to city officials.
The lodging association’s Jacobson said hotels are open to casting an even wider net.
“We want to be helpful where we can, whether that’s with the homeless or domestic violence shelters and shelters that house human trafficking victims that are being shut down,” he said. “We’re hearing of a whole range of potential purposes. Our hotels are going to be flexible. If there’s an opportunity to help a certain audience, we’re going to try to help.”
Chicago’s plan comes as large cities throughout the country grapple with ways to halt the spread of coronavirus. New York, California and Illinois were the first states to institute shelter-in-place orders.
Chicago’s hotel plan is the first of its kind, Deputy Mayor Samir Mayekar told the Tribune earlier Monday. Unlike in other places, where cities have taken over full operations of hotels and other buildings, Chicago’s hotels will be staffed with hotel workers running the front desk, kitchens and other functions, he said.
Employees of the city’s health department will staff floors where people are in quarantine. Hotel workers performing tasks such as making meals and cleaning rooms will have no direct contact with quarantined guests, Mayekar said.
“What we’re announcing today is a pioneering model for the country,” Mayekar said. “It’s one of the first situations in any major city where we’ve actually worked out an agreement with a hotel operator, owner and the workers to help staff this type of agreement.”
Chicago is sharing its model with other cities so it can be duplicated, Mayekar said.
The deal at the former Cambria was part of a negotiation by the city to end a 11/2-year-long strike by UNITE HERE Local 1 workers against the hotel’s operator, Fillmore Hospitality, and an ownership venture including the Ohio Public Employees Retirement System.
“I’m proud of the strikers for standing strong over these last 18 months,” Karen Kent, president of UNITE HERE Local 1, representing hotel workers, said in a statement from Lightfoot’s office. “I’m grateful for the unwavering support of the entire Chicago labor movement. And I’m thankful for the Mayor’s leadership in taking this important step to protect Chicagoans during the pandemic.”
There is no current shortage of hospital rooms in Chicago, but the initiative is in anticipation of potential shortages as the illness spreads.
Plans unveiled Monday have been in development since January, the city said. They are being activated now in anticipation of a “significant increase” in confirmed cases, said Dr. Allison Arwady, commissioner of Chicago’s public health department.
Chicago’s decision to rent hotel rooms comes as the hotel industry struggles to weather a plunge in demand for guest rooms. Occupancy levels at hotels in the central business district hovered at nearly 53% during the first week in March and dropped to 35.6% the following week — about half as high as occupancy rates for the same time period last year, according to hotel industry data firm STR.
Occupancy levels are “in the single digits across the city,” Jacobson said. “I heard one of the largest hotels downtown had one flight crew last night of 10 rooms and one other person. Another hotel had a single guest check in earlier last week.”
The Peninsula and Park Hyatt were among the first Chicago hotels to close last week. Several others followed, including Four Seasons, Virgin, Chicago Athletic Association and The Hoxton. Some properties have stopped taking reservations indefinitely or at least through the end of April. The Omni Chicago Hotel’s website says it will be closed through June 1.
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