Citing the impacts of the pandemic and reduction in tourists, Rosedon Hotel said they have “made the decision to close hotel operations as of July 1, 2020” and hope to reopen in 2021.
Noting they have already incurred losses approaching half a million dollars through May, they said they are “forced to accept that these losses would only be compounded by reopening before adequate demand for hotel rooms returns.”
All employees who have been on layoff since March 18 will be made redundant and paid full redundancy, with Rosedon saying they while paying redundancies will push the company even further into debt, they want to honor their commitment as ethical employers in recognition of their employee’s dedication and loyalty.
While the hotel operations will close for 2020, the Huckleberry Restaurant will remain open.
A spokesperson said, “Since Rosedon Hotel announced the temporary closure of hotel operations on Wednesday, March 18, 2020, the world and Bermuda have struggled to fully understand the long-term implications of the COVID-19 pandemic.
“The statistics and projections most recently announced with regard to limited airlift to Bermuda, and the associated reduction in tourists visiting our island for the next 9 months, paints an incredibly bleak picture for all Bermudian hospitality businesses.
Returning To Operations For The Remainder Of 2020 Is Not Feasible
“Hotel operations typically run at a loss for the first few months of the year but are able to recoup most if not all of that loss through the high season between May and October. Regrettably, with best-case projections by the BTA reflecting occupancy at less than 50% for the island through early 2021, we are forced to face the reality that returning to operations for the remainder of 2020 is not feasible.
Incurred Losses Approaching Half A Million Dollars
“Rosedon Hotel is sitting on incurred losses approaching half a million dollars through May and continues to incur ongoing running costs that will only serve to add significantly to this deficit. Regrettably, we are forced to accept that these losses would only be compounded by reopening before adequate demand for hotel rooms returns, potentially forcing the company into bankruptcy.
“While we have been busy trying to make sense of these business realities, we have also grown increasingly aware of the impact that protracted layoffs have had on all of our staff. The Bermuda Government reacted swiftly with regard to providing unemployment benefits, however, the reality is that living on $500 a week in one of the world’s most expensive places is not sustainable.
“We also accept that the recent announcement of forced redundancies being delayed until the end of October was made in an effort to help businesses avoid bankruptcy and forced closure, but we believe that this has unintentionally transferred a significant portion of the financial burden for ongoing hotel closure directly onto those who continue to be laid off.
“Requiring our staff to live on unemployment benefits alone for another 4 months would effectively force many into poverty, and this is a reality that is absolutely heartbreaking as we consider all team members to be part of our extended family.
Close Hotel Operations As Of July 1, 2020, Employees To Be Made Redundant
“Consequently, Rosedon Hotel has made the decision to close hotel operations as of July 1, 2020.
“In keeping with the terms of our employment contracts, all employees who have been on layoff since March 18, 2020, will be made redundant and paid full redundancy as we have come to accept that the hotel cannot reopen before the end of October 2020 when redundancies would be mandated by law.
“While we could seek to delay this announcement and associated redundancy payments in the interest of deferring the financial consequences to the company, we recognize that our employees are struggling to make ends meet and that all of our employees will benefit from receiving payments now.
Coming To Terms With The Realities Of This Decision Has Been Devastating
“Coming to terms with the realities of this decision has been devastating, but in the face of this and many other uncertainties, we remain resolute in our commitment to our employees and to the long term recovery of Bermuda’s tourism industry.
“While we recognize that the closure of the business is unwelcome and that paying redundancies will push the company even further into debt, we also believe that it is the best way for us to honor our commitment as ethical employers by prioritizing our employees in recognition of their dedication and loyalty.
“We are committed to retrain and re-employ as many staff as possible within our restaurant operation; but the reality is that Huckleberry Restaurant continues to struggle to become a break-even operation and consequently only provides opportunity to the extent that we can generate revenue.
Hope To Be Able To Re-hire Our Former Staff
“When we reopen Hotel Operations in 2021 we hope to be able to re-hire our former staff, but in the interim we are compelled to accept that they need our support now rather than later.”
Huckleberry Restaurant To Remain Open
The Huckleberry Restaurant [website] will remain open, this closure affects the hotel operations only.