The Louisiana hotelier leading a class action lawsuit against IHG, the world's biggest hotel group, was slammed hard by Hurricane Ida and left facing tens of millions of dollars of property damage and little prospect of outside help.
Vimal Patel, whose LaPlace-based Q Hotels Group owns seven budget roadside inns in the state, said Friday that each property sustained damage costing at least $4 million to repair, including substantial roof and flood damage.
Several of the hotels are located directly in the path of Ida, which made landfall as a strong Category 4 storm at Port Fourchon on Aug. 29 and cut a trail of destruction north through southeast Louisiana. Hit particularly hard were Houma and LaPlace, where four Q Group hotels are located. A fifth is in Donaldsonville, which also suffered extensive storm damage and flooding.
"It took us four days even to be able to access the hotels in LaPlace and Donaldsonville because of the water and the downed power lines," Patel said. "It's going to take awhile more to fully assess what's been lost."
On Friday, none of his hotels in Houma, LaPlace and Donaldsonville had yet had their power restored.
Patel's extended family, all of whom work in the hotels, evacuated ahead of the storm to their Springhill Suites hotel. Though it, too, suffered some roof damage, it is the only one currently with power. They have been making the three-hour round trip daily to assess the damage and start repairing the hotels.
Even before the storm, Patel had been struggling to survive the hospitality industry downturn brought on by the COVID-19 pandemic. Adding salt to those financial wounds, his Staybridge Suites hotel in Lake Charles was severely damaged in 2020 by Hurricane Laura, a Category 4 storm that caused an estimated $20 billion of damage in southwest Louisiana and elsewhere.
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Patel said it was the treatment by London-based IHG during the early months of the pandemic and after Hurricane Laura that ultimately persuaded him to bring the lawsuit against the group in May.
"These are the kinds of situations where you'd think they can and should help," he said. They could offer some financial relief as well as help in sourcing supplies, repairing damage. "But instead all I got after Laura was constant pressure about when we'd be reopening, even before we'd been able to properly assess the damage there," he said.
Patel owns Holiday Inn Express franchises in LaPlace and Donaldsonville, as well as a Candlewood Suites in Houma and the Staybridge Suites in Lake Charles, all of which are brands owned by London-based IHG.
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One of the allegations in the lawsuit was that it costs franchisees millions of dollars to renovate, remodel and complete new construction, while IHG insists they use only suppliers approved by headquarters. The suit alleges that IHG receives kickbacks from those suppliers, and that the system is a disguised way for them to jack up franchise fees while leaving franchisees with inferior quality remodeling.
IHG spokesman Jacob Hawkins said the hotel group wouldn't comment directly on pending litigation.
After filing the suit, Patel was joined by hotel franchisees in Texas and Pennsylvania in June.
"We have reviewed the small number of similar complaints that have been filed by individual owners, and we do not believe any of the claims have merit," Hawkins said. "We are vigorously defending our company through the correct legal process."
Patel said he is looking for help from his contacts in the industry, especially his fellow members of the Asian American Hotel Owners Association, to overcome a pandemic-related shortage of building materials and other supplies.
Associated General Contractors of America on Friday said an analysis it commissioned showed that costs for materials such as plywood, metals, insulation and transportation fuel have soared in the past year by an average of about 20% - and as much as 123% for some items.
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Patel is trying immediately to source 15,000 pieces drywall, as well as large quantities of gypsum wallboard and insulation, so he can begin repairs. Despite sympathetic replies to his messages on social media, most respondents said they were in the same boat, with suppliers facing inflated costs and shortages because of the pandemic.
As Ida approached, Patel said, it brought back memories of Hurricane Katrina in 2005, when the family sheltered in one of the LaPlace hotels as his daughter was about to turn 5.
This time, he said, it was gut-wrenching to drive through the neighborhoods of LaPlace on his way to assess the hotels and his own home, seeing houses flooded and piles of debris stacked outside. He dreaded the task ahead.
"It absolutely looks like a war zone, and one will never feel it unless you see it with your own eyes," Patel said. "The real struggle is just beginning for a lot of us."
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