The weak US economy continues to impact virtually every segment of consumer and business spending, worldwide. Clearly with consumer spending less day by day, leisure travel is suffering. With travel being a high discretionary part of consumers’ budgets, it is often the first things that Americans and the first world forgo.

Business travel may be even worse. It has been recently reported by Gannett News Services that a whopping 71% of corporations will spend less on business travel in 2009 than in ’08 when there were also cutbacks. Only 8 percent of companies reported traveling increasing this year. The cost to business travel alone? Over 8 billion dollars in lost revenue.

Beyond traditional business travel, the import and export business is losing ground. Miami, one of the United States’ busiest ports is down 6% in 2008 with no turnaround in site.

The impact is dramatic. Hotels, resorts and cruise lines are offering bargain basement deals to try and fill rooms and seats. Airlines have tried fare sales in Q4 of 2008 to try and keep every seat filled. Although airlines can self correct their business by cutting back on flights to save money and fuel. By cutting back on the number of seats available they can eek every last ounce of profit with each flight.

It’s not the same with hotels however. An empty bed means no revenue and there is nothing worse for hotels than a low occupancy level. So, hotels, cruise lines and even car rental companies are offering low rates to fill rooms. According to Smith Travel Research, occupancy in North American hotels was down 10% year over year last November. PricewaterhouseCoopers predicts that overall occupancy in 2009 will decrease by almost 4 %, which would be the highest decline since 2001. Further, hotel and resort expansion is up 1.6% taking overall occupancy to 58.6% which is the lowest since 1971. This can turn out to be a great deal for bargain hunting travelers and companies like Priceline.com, but not for the large hotel and resort companies. One salvation for hotels and resorts is by offering very low rates to get customers into beds and hoping they’ll spend more in the hotel’s restaurants, bars and spas.

Could it mean hotels and resorts actually have to close their doors for good? Absolutely. In Palm Springs California, a new Ritz Carlton development was put on hold as their financing was through Lehman Brothers. Two East Bay hotels outside of San Francisco are facing foreclosures on their mortgages. The Sheraton Pleasanton Hotel, a 170 room hotel and the Coliseum Suites, a 293 room property, have defaulted on their mortgages according to the Alameda County property records. There’s more: The Los Angeles Hilton is in the hands of Security Pacific National Bank. The Westin Canal Place is now owned by The Travelers. Morris Lasky is the Chief Executive of Lodging Unlimited in PA, rescuing hotels in trouble. He says he used to get 4 or 5 calls a month about hotels in financial trouble, but today receives that many in a day.

So what do banks do with hotels they have to take back? Traditionally banks don’t want to be in the hotel business. But today there is a huge lack of buyers, because banks aren’t loaning money and potential buyers don’t have the ability to pay 100% cash for these properties. David Renton, who leads a hotel investment fund in Stamford, CT says “this is the worst crisis for the industry since the Great Depression.”

With bankers not ready, willing or able to handle hotel foreclosures some are hanging on for dear life. However the news gets worse- with banks not knowing how to run hotels without bringing in expensive and experience hotel executives to save a property, often times the hotels fall into far worse financial shape once it’s back in the hotel’s hands.

What should you do if you’re a hotel/resort owner and you don’t want to be? You can call an expensive investment banker which will take a good deal of time and a good deal of expense in unloading the property. Or, you can call on California foreclosure experts at Terra Asset management.com. Operating in Palm Springs, Terra Asset Managers and its partners have unique foreclosure expertise and are the leading foreclosure specialists in Southern California. Terra Asset Management.com can cut your time of sale down. Equally important, Terra can limit your liquidation risk and most importantly Terra has the resources and the relationships to get your property sold quickly.

The 4 step process of Terra Asset Management takes the worry off your shoulders and handles all aspects of selling the property.

Terra Asset Management is a full services real estate firm and has contractors,
CPA’s, legal and other help that may be necessary for you to sell your property.

If you have a hotel or resort property and other brands and you need it sold, call Terra Asset Management. com .. Charles Stewart can be reached at (760) 866-0021.