Daniel Berman, President & CEO at AD1 Global, a fully integrated hospitality, acquisition, development & management company.
The hospitality industry has always been a delicate balancing act between opportunity and risk, but when Covid-19 swept across the globe, it shook our industry to its very core, leaving even the most seasoned operators at its mercy.
For my organization, the challenges were compounded by several loans that were tied to inflation. We were not alone in this regard. No one could have foreseen the inflationary tsunami that swept across the land, raising the prices from eggs to hotel loans dramatically.
Everything got way more expensive, but hotel rates did not grow. So, while labor and everything else increased in cost, we were forced to fight for revenue by maintaining or lowering our hotel rates to be competitive.
Many companies closed their doors in the face of this onslaught. We chose to fight. We faced one of the most difficult periods in our company’s history—the bankruptcy of eight out of 30 hotels in our portfolio. This challenge tested our resolve, strained our relationships and put our reputation under the microscope.
But this isn’t a story about defeat. It’s a lesson about resilience, transformation and an unwavering commitment to excellence.
The Storm
At the onset of the pandemic, travel restrictions, lockdowns and an unprecedented drop in consumer confidence resulted in plummeting occupancy rates. High interest rates compounded the pressure, making it nearly impossible to maintain the financial stability of some of our assets. Among our portfolio of 30 hotels, eight properties bore the brunt of these challenges, ultimately leading us to the difficult decision of filing for bankruptcy.
The experience was humbling. It wasn’t just the financial strain; it was the emotional toll of knowing that our team, partners and stakeholders were looking to us for guidance during an economic condition unlike any we’d faced before.
Reclaiming Control, Rebuilding Trust
As we navigated this period, we knew one thing for certain: This was not the end of our story. We saw bankruptcy for these hotels as a reset, not a conclusion. We rolled up our sleeves, restructured our operations and leaned into the values that had brought us success in the first place—integrity, innovation and a relentless focus on guest experience. Communication with all constituents was key to achieving this. We took the time to regroup and evaluate all of our processes.
Additionally, through strategic negotiations and a clear vision, we have recovered and expanded our management portfolio, securing contracts for eight additional properties since then. These new partnerships were not just about growth; they were about demonstrating that we had learned, adapted and were stronger than before.
Martin Luther King Jr. had it right when he said, “The true measure of a man is not how he behaves in moments of comfort and convenience but how he stands at times of controversy and challenges.” The same holds true for any business.
Lessons Learned And Shared
1. Transparency builds trust. Throughout our journey, we prioritized open and honest communication with our stakeholders. Admitting challenges and sharing your roadmap to recovery can help foster a sense of trust that then becomes a cornerstone of your resurgence.
2. Adaptability is key. The hospitality landscape has changed dramatically, and so should you. From implementing cutting-edge AI solutions to reimagining operational efficiencies, I encourage you to embrace innovation to stay ahead.
3. Resilience is a team effort. The strength of your company lies in your people. From our general managers to our front-line staff, everyone played a role in rebuilding our brand and delivering exceptional guest experiences.
Moving Forward: A New Chapter
My experience shows that resilience in business isn’t just about recovery—it’s about adapting, learning and emerging stronger. I believe this time reinforced the importance of sustainability, technology and community engagement in shaping a successful hospitality strategy.
Setbacks, including financial struggles, are an unavoidable part of business. What matters is how leaders navigate them. They say a broken bone is only stronger after it has healed. Yes, there are still articles online about our bankruptcy, but we welcome those conversations. You should look to moments like this as allowing you to share how you’ve turned adversity into a blueprint for success—a story that inspires confidence rather than skepticism.
Final Thoughts
To any organization navigating tough times, know this: The road to recovery is rarely linear, but it is always possible if you don’t give up. Challenges don’t define your legacy—your response to them does. With the right mindset, you can emerge with a renewed sense of purpose and a steadfast commitment to setting new standards in hospitality.
As I reflect on this journey, I’m reminded that resilience isn’t about avoiding failure; it’s about learning, growing and coming back together as a team, stronger than before.
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