Revenue at Maine’s hotels, motels, restaurants and bars has plummeted during the pandemic. In the midcoast and Downeast parts of the state, businesses are coping, sometimes more successfully than they anticipated, in a season unlike any other.
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The pandemic has taken a heavy toll on a hotel industry “on the brink of collapse,” according to the American Hotel & Lodging Association.
Out of more than 1,000 owners, operators and employees surveyed by the Washington, D.C.-based trade group from Sept. 14-16, 68% had less than half of their typical, pre-crisis staff working full time. Half said they are in danger of foreclosure by their commercial real estate lenders because of COVID-19. And, without further relief, more than two-thirds expect to survive just six more months at current projected revenue and occupancy levels.
In Maine, the hospitality sector — hotels, motels plus restaurants and bars — is projected to experience a $1.7 billion drop in revenues this year, to $5.2 billion, after 12 straight years of record growth, according to a report released in October by HospitalityMaine.
Hotels, many of which would normally open in the spring, began reopening in June amid new health and safety requirements and restrictions on out-of-state visitors that have been gradually eased. As this issue went to press, Rhode Island remained the only New England state not allowed in with a negative test or quarantine.
What does that mean for hotels in Maine’s popular midcoast and Downeast regions? HospitalityMaine President Steve Hewins says that while there are indications they did fairly well with visitors from Connecticut, New York and New Jersey, the Massachusetts dropoff has hurt business.
“The thing about the midcoast and Downeast,” he says, “is that it’s not a day trip out of state, so you’ve got to stay overnight. The lack of Massachusetts visitors coming here has clouded everything.”
For the view on the ground, Mainebiz checked in with five hoteliers in the region.
ARAGOSTA, DEER ISLE: Busier than ever
At Aragosta at Goose Cove hotel and restaurant in Deer Isle, social distancing on 22 mossy coastal acres with 10 private cabins comes naturally, albeit with some tweaks during the pandemic.
This summer’s modifications included introducing takeout and a tasting menu at the farm-to-table restaurant recently named Maine’s best by Down East magazine, expanding the outdoor deck and all the new health and safety requirements.
Mindful of the turmoil many of her peers are going through, owner and executive chef Devin Finigan is thankful her establishment kept busy all summer, its second season since she bought the business and moved her family there.
“It’s been one of my busiest seasons ever,” she says. “I hate to even say that, knowing so many people are struggling. Last year we started late, but we were new. This year, we’ve been in the 90% occupancy rate since the beginning of July.”
Finegan, a Vermont native and chef’s daughter who has been working in kitchens since age 14, says her business currently employs around 38 people. About a third were unexpectedly in Maine this summer because of the pandemic.
“We have Harvard graduates who were supposed to have internships in New York, and all these employees that had other plans,” she says. “They were back where they grew up and came to me for jobs … If COVID didn’t happen, I wouldn’t have this amazing staff.”
As far as the restaurant goes, Finigan says that while she had wanted to eventually move toward a tasting menu, that happened more quickly out of necessity. She reports that it was well-received, along with the takeout business she started before being able to open for guests and plans to revive in the off-season.
“This was all about adjusting and really listening to our clients,” she says.
Events were also quiet, with two smaller weddings of around 40 people each this summer. Finigan says they were “beautiful and intimate,” as she looks forward to 2021 with already six weddings on the calendar postponed from this year.
SEBASCO HARBOR RESORT, PHIPPSBURG: Weathering the storm
Sprawled across 450 acres on Casco Bay, the Sebasco Harbor Resort is like a village unto itself, with accommodations from cottages to the 10-room Lighthouse, a nine-hole golf course and indoor recreation center with candlepin bowling.
“We’ve weathered the storm,” says Bob Smith, self-proclaimed lighthouse keeper and majority owner.
The resort closed for the season on Oct. 17. Attracting new visitors from New York and New Jersey helped.
“We certainly made a lot of new friends from those two states this year,” he says.
While the resort normally employs up to 150 seasonal staff, in late September it was at around 80.
After a late start and no business the first month it was open, occupancy levels rose every month to the “second best half of August we ever had,” he says, reporting in late September that “the last two or three weeks were really unbelievable.”
That added to pressure on a stretched workforce, even with Smith and family members chipping in to work, “grabbing every warm body we could,” he says.
“We did fine in food and beverage and other areas, but it was really hard to get every single room back online, clean and ready,” he says. “There were a few nights at the end when we couldn’t clean the entire place and sell all the available rooms. You can only ask so much of people, and some were already working 80 or 90 hours a week.”
Smith, who has invested millions in projects and renovations since buying the property in 1997 he lovingly calls “The Money Pit,” expects a quiet off-season.
“I think we’ll make it through the winter without really being able to do a lot of the things we like to do in the off-season to fix the place up and get it ready for next year.” he says. “We’re going to have to cut back a bit more than we would, but we’ll do our best to weather the storm.”
CAMDEN HARBOUR INN, CAMDEN: Finding a rhythm
In May when Mainebiz previously checked in with Camden Harbour Inn co-owner Raymond Brunyanszki, Natalie’s Restaurant had switched from fine dining to takeout as the crew had fun producing tongue-in-cheek video vignettes about surreal aspects of the “new normal.”
On June 1 when the hotel and restaurant reopened, Natalie’s offered inside and outside dining, in-room dining and still offered takeout. Decked out in romantic red, the restaurant serves as the culinary anchor for a hotel that belongs to the international Relais & Chateaux luxury hotel and restaurant association.
“In the beginning, everybody had to find their rhythm a little bit, but the guests really appreciated all the work we had done to keep them healthy and safe,” says Brunyanszki, co-owner since 2008 with Dutch compatriot Oscar Verest.
Brunyanszki says that while occupancy rates were low into July, August was better than predicted, and they’ve been improving ever since. And while he expects a 15% to 20% drop in revenue over last year, that’s no cause for concern.
Last year “was definitely the best we had, so I’m not too disappointed,” he says.
While visitor numbers were way down from Massachusetts, Florida and Texas this year, visitors from New York, Connecticut and New Jersey compensated for it.
“Flying into Portland was not easy this year,” he says, “but the good thing is that Maine was perceived as very safe. For sure that helped with business.” Nevertheless, “I would have liked to have seen Massachusetts being opened up much sooner, then we would have had somewhat of a normal year.”
COD COVE INN, EDGECOMB / CEDAR CREST, CAMDEN: Putting on a happy face
Ted Hugger and his wife, Jill, are originally from Michigan and have been in Maine since 1986. They are relative newcomers to the hotel business, having owned the 28-room Cod Cove Inn in Edgecomb since 2013 and the 37-room Cedar Crest, which also has a restaurant, in Camden since 2018.
“Business has been picking up at both of our properties,” Ted Hugger reports in early October.
A serial entrepreneur on his seventh business who also serves as a selectman in Edgecomb, Hugger says they run the inns on different business models, with the Cod Cove Inn open year-round and the Cedar Crest as a seasonal property.
Even with hundreds of thousands of dollars in loans to get through the pandemic, Hugger predicts that “it’s going to take a long time to dig out of this hole that we’re in.”
He has also been grappling to make sense of a confusing application for grant funding from the Maine Economic Recovery Grant Program. He likens it to a calculus exam, and says there’s still a lot of confusion in the hotel industry about who is and who is not allowed to travel into Maine under state rules.
“Try explaining to someone on a farm in Iowa why they can’t come to Maine without a COVID test, when someone from Boston or New York City can come and go as they please,” he says. “Makes no sense.”
Yet he does not let that sentiment get in the way of service at his hotels, saying, “That’s what we do. Any time there’s any kind of hardship in this business, you put on a happy face, you make the best of it, and you do what you have to do to make sure guests have a spectacular experience.”
BAR HARBOR INN, BAR HARBOR: Sticking with optimism
“Upbeat is a choice. The alternative is not very productive at this point … Optimism wins all, so we’re sticking with it.”
That’s the word from Jeremy Dougherty, general manager of the Bar Harbor Inn, who plans to carry that optimism through the holiday season and beyond.
The 153-room establishment, located on eight acres overlooking Frenchman Bay, opened about two months behind schedule this year on June 1.
“June was abysmal,” Dougherty recalls, with occupancy rates hovering at around 16% instead of in the 80s or 90s, before picking up in the second half of July and August but still well below normal. Still, he says, “it could have been worse.”
Speaking more generally about the Bar Harbor tourism business, he notes that it’s all leisure travel without any corporate or convention business like other markets he has worked in. He’s also pleased with the large number of guests from in-state this year, saying, “Maine really showed up this year.”
On the workforce front, the hotel has operated well below capacity, due to factors from health concerns and an inability to hire international workers on temporary J-1 and H2B visas this year.
“Everybody was completely strapped on staff, and if one person gets a sniffle you have to send them home and you lose them for a week,” he says. While the workforce count would typically be around 160 to 170, it was at 150 in late September. On the plus side, Dougherty says that having fewer people made it easier to provide on-site housing.
While the Bar Harbor Inn would normally wrap up for the season the day after Thanksgiving, this year’s plan is to make a go of it through Jan. 3.
“It’s not going to do much to make up for it,” Dougherty says of the shorter season, “but it helps keep some of our staff a little bit longer … We’re going to give it a shot.” Plans include a “really great Santa and Mrs. Claus,” carriage rides and live rented reindeer that Dougherty expects to touch down well before Christmas.
“Everybody has had enough time to be depressed, so now we make adjustments and start planning ahead,” he says.