I don't get the level of animosity in this thread.

It's a business decision of the hotels owners / management. Plenty of properties have dropped their rates significantly. Element NY Times Square is a $79 now and thats on their website without calling anyone. This property didn't - so what!?

As far as the bad element is concerned I think most have stayed at a hotel, resort or cruise before that has a high headline price and suddenly started to dump inventory on Priceline/Hotwire. It can spoil the experience of regular paying guests.

In my experience, I've found the people who scream racism and discrimination are usually the biggest offenders themselves.

I fully support the hotel in this! I did a mattress run earlier this month as a hotel which normally goes for $125-$200/nt was down to $61/nt. It's a hotel I've stayed at many times in the past and have befriended some of the staff. Yes, the clientele was noticeably different, and not in a good way. I saw a lot of local license plates, not normal. People were smoking pot inside the hallways, rooms, and were generally loud and rude, well into the wee hours of the night. Sadly, I'd imagine the costs the hotel incurred to clean/fix the place after the unsavory guests may well have wiped out any gains from higher occupancy.

It's entirely down to circumstance. There's no point in reducing a rate to the degree that you cant make any money and in most cases a closed hotel is better than a 2% occupancy rate.

If there's minimal competition theres no point in reducing rates. If there are other hotels in the vicinity then the decision is whether or not to join a price war, gambling that loyal customers will return anyway.

And if there is competition and you're unhappy with the price your regular hotel is charging, you can always go somewhere where they have reduced rates.

First off be safe out there ! Also you know that it’s all about money. A logically answer and way to fix this hotel issue would be to charge based on the applicants lodging there. When here in the US and other places that have the stay at home orders they could lower it or give you some type of discount. I think also off the top of my head that if they lowered rates people would ignore social distancing and stay because of the prices being so cheap, making it like the cruise ships , a walking epicenter. But in reality they could care less I think it’s discrimination. They want to keep certain people out wether they make money or not. Will people see this ? No they will make all other types of assumptions. They should be closed if they can’t offer better prices and also better service. Also be thankful for people who are still considering staying in their hotels.

(1) I can't speak to what the marginal cost of adding a guest is, but I suspect that is partly at play, particularly if there's a need/desire to limit staffing.
(2) Some hotels have had to knock capacity for various reasons related to the virus (staffing limits, etc.).
(3) As indicated above, slashing rates outside of the absolute last minute (<24 hours out) could well trigger cancel-and-rebook moves by existing customers. Remember, the shuffle in corporate policies over the last few weeks has basically knocked out the yield management practices of the last decade or so. Meanwhile, 95% of travel right now is probably not discretionary.
(4) As also indicated, there's a question of managing guest expectations in terms of rates and protecting pricing power within a complex brand structure.
(5) And finally, "the wrong kind of crowd" does not necessarily mean or imply a protected class of customer. I suspect that some higher-end hotels don't really want to deal with "trailer trash" or the cast of Jersey Shore any more than they do any other kind of "undesirable" low-yield customer. This isn't to speak to any particular case or set of cases, but I'm sure that there are plenty of higher-end hotels that have that that sort of thing in mind, particularly since those customers can (apparently) be quite a batch of humdingers at times...

I have a minimum rate below which I won't stay at the hotel regardless of price. I came to my conclusion after spending the night at the following:

• A formerly very nice Marriott Courtyard in Stockton California during the middle of the 2009 recession. It was full of construction workers and the parking lot looked like a high school beer bust. Non-stop loud music, drinks and fighting all night.
• A typically nice hotel in Las Vegas that was running a $39 special. People running up and down the hallways and screaming all night.
• An Embassy Suites in Orlando near Sea World in February. $29 special rate resulted in entire families in one room. The place was trashed.

Not discrimination, just that super low rates tend to bring out people who don't get it.

At that price, you would have thought they could afford two or three rooms!

Even cutting the price in half, the occupancy rate will remain at 2%, so why do it? There is no price elasticity to the demand, other factors at work. read the news.

I would expect to see the lower rates on the third party sites, the mystery 5 star hotel which you wont get to see until you book that provides no benefits and perks. No need to aggressively price on their own platform.

Leave it to the people in the business to run the business. They know their profit points better than you.

I expect a lot of them will just close. There is hardly any demand, and key now is to reduce costs, not try to generate minimal cash flow.

Electricity rates don't go down, neither do water rates. Housekeeping is still not paid enough, so you are asking for them to take a cut for you. Security probably needs to be increased rather than decreased. Which service would you be willing to eliminate so you can get an extra couple of dollars off a room rate? Hotels are businesses that still have to pay all their bills and taxes, and a 2% occupancy rate is horrifying, especially if it lasts. I would think, if anything, after this is all over, a hotel might have a "One Week Welcome Back" deal that will get their regulars to stay at their property again. Other than that, as a business person, IMHO, your assumption/request is a bit over the top.

I can see multiple reasons for why a hotel wouldn't lower its rates now. Some align with what the manager told you.

1) In the economic downturn of the early 00s airlines and hotels slashed their rates to attract business. As business recovered they found resistance to raising them. Industry-wide the deep price cuts were recognized as a mistake and were not repeated in the '09 downturn. Yes, prices were lowered some to compete in a slow market, but not at fire sale levels like years earlier.

2) With the current public health crisis hotels are not able to operate normally. Staff are impacted, suppliers are impacted, etc. Keeping normal room rates and operating at 5% nightly occupancy with a skeleton crew and limited service may be the best economic decision -- (edit) and the best health decision.

3) Dropping rates significantly will attract a different clientele many hotels consider undesirable. At low rates they'll get borderline homeless, parolees, registered sex offenders, drug users/dealers, gangs, sex workers, and sex parties. I've seen cheap hotels that more or less understand this is the end of the market they're operating in. I don't see any property in the Marriott portfolio wanting to dip its toe in this water.

Even in "normal" times, some hotels have chronic problems with parties.

Here's a notice on the Residence Inn Greece NY website which has been there for over a year:
(!) Additional USD100 deposit hold will be placed on your credit card if reservation includes Friday and/or Saturday night

And they're FAR from the cheapest hotel in the area.

One of the craziest posts I have seen on Flyertalk in years. Sad really.