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J.H. Freeman/MEDILL

Dowtown lodging may be the way to go as hotels slash rates, but keep customer happiness the main priority.

Chicago hotels offer silver lining in cloudy economy

by J.H. Freeman and Leslie Patton
Jan 22, 2009


Leslie Patton/MEDILL

The Blackstone Hotel on Michigan Avenue is not cutting any of its guest services.

Downtown Chicago hotels aren’t bowing to the recession by removing amenities like mints left on pillows, courtesy lotions and shampoos or bed turndown services. At the same time, they are extending a hospitable hand to increasingly frugal consumers by cutting room rates and boosting special offers.

“We wouldn’t cut back because that’s hurting the guest service we do,” said Jason R. Poole, assistant general manager at the Red Roof Inn on East Ontario Street. The hotel recently did the opposite, adding coffee makers and extra sets of towels in rooms.

“The company is not planning on cutting any amenities,” confirmed Marina MacDonald, senior vice president of sales and marketing for Red Roof Inn Inc.

Glynn Knight, Courtyard Marriott general manager of the Courtyard Marriott on East Ontario Street, echoed Poole’s sentiments, noting that cuts aren’t necessarily a good thing for a hotel’s bottom line.

“Why would you cut an amenity now?” he said. “That would be shooting ourselves in the foot to do that. If anything, we’ll figure out a way we can add something.”

Directions from corporate “require that you can’t go below the standard,” Knight said. “For example, now, if you don’t have lotion you won’t be penalized,” he added.

National hotel room occupancy fell 3 percent in 2008 from the year prior to 61 percent, according to Smith Travel Research Inc., a benchmarking and reporting company in Tennessee. This year’s projections are even worse, with occupancy projected to fall to 59 percent, the lowest it has been since 2003.

To manage dwindling demand and remain competitive, several downtown Chicago hotels have been slashing rates. “We have lowered room rates to attract business,” Knight said. Room prices have gone down in all of downtown Chicago, Poole said.

However, lower rates have not adversely affected customer service, and guests contend that there are still plenty of perks.

“Service was impeccable, the room had soap, actually fancy soap, shampoo, lotion, you name it, everything was in there,” said Holly Rodgers, an Evanston photographer staying at the Hilton Chicago on South Michigan Avenue, who noted that she took the shower cap offered by the hotel. She also recently stayed at the Four Seasons Hotel Chicago on East Delaware and the Millennium Knickerbocker Hotel Chicago on East Walton Place, noting they were “great” as well.

“What I have seen is a decline in the number of working people…but service actually is pretty good here…they understand the value of hospitality,” said Robert D. Klausner, a Florida-based attorney traveling for business and staying at the Hyatt Regency Chicago on East Wacker Drive. Klausner, a veritable nomad, is on the road about 120 nights per year.

Hotels are, however, being careful not to schedule more workers than necessary.

“We only bring in the housekeepers we need,” Poole said, noting that Red Roof Inn is not planning layoffs of any kind.

If there are any cutbacks at the Hard Rock Hotel on North Michigan Avenue, it would be in personnel and scheduling, said Fred Khoury, director of sales at the hotel.

Hotel, motel and resort desk clerks in Illinois worked an average of 9.8 hours per week in 2007, compared with 20.7 hours for all Illinois occupations, according to the Bureau of Labor Statistics. Similarly, maids and housekeeping cleaners averaged only 9.5 hours of work per week in 2007.

Even with a dreary economic outlook, scrimping on customer niceties is a line Chicago hotels clearly will not cross. “We will not touch anything that would negatively affect our guest service level,” said Gretchen Spear, Hyatt Regency Chicago promotions manager.