21c Museum Hotel lays off or furloughs more than 100 Lexington employees
More than 100 employees of the Lexington 21c Museum Hotel will be laid off or furloughed starting Thursday, company officials have warned.
In total, 238 employees at its Lexington and Louisville locations could be laid off or furloughed, according to documents 21c Museum Hotel filed with state and local officials.
In Lexington, the 121 positions include managers, front desk clerks, cooks, housekeepers, servers, parking attendants and engineers, according to documents 21c Museum Hotel filed with the Kentucky Career Center and the city of Lexington.
“This mass layoff is expected to be permanent in nature, given the current economic circumstances,” Andrew Lotter, corporate director of talent and culture for 21c Museum Hotels, wrote in a letter shared with Lexington officials.
Stephanie Greene, a company spokeswoman, said 21C hopes to bring back its Lexington employees this summer when the hotel reopens. A date for that reopening has not been announced.
“We expect to reopen 21c Lexington this summer and bring our furloughed teammates back,” Greene said. “ We are working every day to achieve that goal and finalizing changes to our operations procedures to ensure we can do our part to keep our team, guests and community safe and healthy.”
In addition, The Louisville Courier-Journal reported the 21c Museum Hotel has notified officials there that it will lay off or furlough 117 employees at its Louisville location.
The hotel chain temporarily closed at the end of March due to the coronavirus pandemic. It has hotels in seven other cities in addition to Louisville and Lexington.
The hotel and motel industry has been battered by the pandemic as travelers stay home. A U. S. Bureau of Labor Statistics April report showed the hotel and tourism industry has lost more than 7.7 million jobs across the country.
In a recent survey of American Hotel and Lodging Association members, 8 in 10 hotel employers said they have had to lay off or furlough workers. Only 37 percent have been able to rehire staff through economic relief measures such as the federal government’s payroll protection loan program,.
Earlier this month, the 21c Museum Hotel got a break on payments on a $6 million loan backed by the city of Lexington.
In 2012, the city of Lexington agreed to give 21c a nearly $1 million grant and a $6 million loan through a U.S. Department of Housing and Urban Development program called a 108 loan. If 21c Hotels could not make payments on the loan, HUD could tap the city’s community development block grant money to make those loan payments.
Community development block grants are typically used to fund low-income housing and other infrastructure projects.
After it temporarily closed in March, 21c Museum Hotels warned the city of Lexington and HUD that it likely could not make a $353,000 July payment on the $6 million loan. HUD and the city agreed to suspend payments on the principal for three years.
The remaining principal payments for the loan will increase starting in 2023 from $353,000 to $441,000 until 2034. The total remaining principal on the loan is $5,294,000, according to loan documents.
The $43 million Lexington hotel, with 88 rooms, the Lockbox restaurant and bar as well as art exhibit space, opened in the former First National Bank building in February 2016.
This story was originally published May 26, 2020 at 8:36 PM.
