Resilient Houston hotels emerging from Ike

HOUSTON—Steve Cunningham admits the Hotel Zaza here got off easy. Five days after Hurricane Ike sent howling winds and punishing rains through the city last month, the 315-room, 16-month-old hotel was recovering from what Cunningham, the general manager, said was a moderate amount of broken windows and water damage. Fortunately, the 12-story Zaza never lost electric power, which turned out to be key to its ability to rebound. By contrast, hotels elsewhere in Houston suffered more severe water and wind penetration as well as a loss of power. Meanwhile, Richard Clark, managing director of Houston-based Arthur J. Gallagher Risk Management Services, described the situation on nearby Galveston Island as the most dire of all. “Galveston took the brunt of the storm. Many of the hotels there are low-rise and were fairly devastated. The closer to the coast a hotel was, the more likely the storm turned it to toast,” said Clark, who toured the stricken area within days of the storm abating. Cunningham’s counterparts at these hotels couldn’t be reached to comment to HOTEL BUSINESS®, but his first hand experience with Ike—both in the run-up to the storm and then in its aftermath—provides something of an object lesson in managing through this kind of emergency “We’re almost back to normal, although we’re operating with some damaged areas,” said Cunningham four days after the storm. “Windows blew out in our street-level bar, but we’re getting ready to reopen both the bar and restaurant. There will be plywood on the windows and a concrete floor since we had to rip up the wood floor because it was saturated.” The Zaza, which was originally built in 1928, is the former Warwick Hotel. It was converted to the Zaza following extensive renovations in June of 2007. It’s owned by the Charles Given Interests, which also owns the Hotel Zaza Dallas. The Zaza was one of the few hotels in the city not to lose power, possibly because it’s on the same electric grid as the city’s medical center. Given the severity of the storm, 15 employees weathered the hurricane in the hotel overnight to monitor the condition of the building. “The wind was blowing so hard, it popped doors open that were locked, blowing in rain,” Cunningham recalled. A critical decision was made on Sept. 11, the day before the hurricane struck, to evacuate all guests from the hotel. “We went down to zero occupancy that night. We didn’t want to risk having 100 to 200 guests in the hotel and losing power or having something major happen to the building and not be able to protect them,” Cunningham said. So even though the hotel lost revenue, the management team decided to close the property. “We were able to get everybody out and not put anybody on the street,” Cunningham continued. “We had started telling people the day before that it was likely we were going to have to close just because the forecasts were so severe.” In hindsight, did Cunningham think that was the right decision? “I’d do it again in a heartbeat,” he said. Similarly, the hotel called all guests expected to check in to update them. The hotel reopened gradually the next day even as the clean up was underway. Cunningham reported there was a major demand for rooms. “If the building hadn’t been so wet, we could have sold more rooms, plus we had very little staff here,” he said. Maintaining communication with staff members became a major challenge. So many people evacuated the city, including Hotel Zaza employees, that only a few more associates reported to work when the property reopened. Short staff “Even with no catered events scheduled, just to run PBX, front desk, housekeeping, restaurant/bar on a normal weekend night you probably need a minimum of 35,” Cunningham explained. “We had less than 20. Plus, you need another 30 housekeepers the next day.” The hotel had some emergency preparedness processes in place for reaching associates. As they left town, the management team had a form ready that they filled out with contact information. It asked for more than just a cell phone number. If they thought they were going to go stay with a family member outside the city, the hotel asked for that information also. Therefore, if it turned out the hotel was down for an extended period, management had a way of communicating with its employees. “We also instructed associates to call into the hotel. We set up a voice mail line where I’d leave messages updating associates on the situation,” Cunningham said. Hotel owner Charlie Givens was in close touch with the management team through the whole experience. “He was very hands-on, very supportive,” Cunningham said. “Had we needed additional associates to fill in, he was prepared to send support from our sister property in Dallas.” Three days after the storm, the hotel had roughly 75% to 80% of its associates back. Of those, probably 75% still didn’t have power restored at home. In addition, it was a struggle for them to get to work, considering little public transportation was operating. “We opened our spa and some guestrooms, so associates could shower here,” Cunningham reported. “We even sent ice home with them.” Houston-wide, hotels were cooperating for the common good. A number of hotels in the Zaza’s competitive set remained closed. Some groups relocated to the Zaza because their original hotel was either closed or had too many rooms out of order to be able to handle the bookings. Initial demand for rooms came from local residents who were without power and water, who were coming for shelter and a hot meal. The Zaza is also a pet friendly hotel. An issue for people during the hurricane in both Houston and Galveston Island was that they didn’t want to evacuate and leave their pets behind. “The night we reopened,” Cunningham noted, “about half our rooms were rooms with pets.”