Dear Hotels: Canceling a Confirmed Reservation Will Cost You

Can Hotels Cancel a Confirmed Reservation in Advance? Yes, they can and sometimes do, including walking clients in oversold situations, as I discuss in the linked article. But even if the hotel cancels a reservation in advance, they owe the client holding a confirmed booking more than just a full refund, especially when the clients holding the confirmed reservation are likely to have few or no comparable alternatives available for those dates, say because of the location of the hotel, high hotel demand due to a major event, and/or the hotel cancelling without a lot of advance notice to the clients.

Here's an email I received recently, from a Virtuoso hotel no less:

“Your client, booked at [hotel] for [dates] is going to be impacted by what is currently happening with the property.  [We are] currently working with the owners of [hotel] in a transition of ownership of the hotel. Due to this transition, the hotel has stopped taking new reservations and will be canceling existing reservations for the period of [date] to [date] as we are expecting the hotel may close over this time period.

We can move the client's reservation to sometime after [date] or cancel it with full refund.   I am so sorry to have to be sending you this email….”

Frankly, I find it wholly unacceptable for a Virtuoso hotel to unilaterally cancel client reservations just because of an ownership change. Ownership changes as well as reflagging changes occur with much larger properties than this one, with a smooth transition from one day to the next.

But if the property really does need to close, just refunding guest deposits simply isn't enough when unilaterally cancelling a reservation. This particular hotel isn't in the U.S., and the clients have a >8 hour flight to get there. Almost no one purchases refundable tickets, and hotels know this. The clients are now holding non-refundable flights to go to a hotel that has cancelled their reservation.

Nor does travel insurance cover this case, because the hotel will refund the deposit; the problem is that the point of the trip (staying at the hotel) is now moot. There is also no comparable property near the hotel due to the hotel's remote location.

That's why we've asked the hotel to cover the difference in cost between the hotel and the most comparable property, quality-wise, even though it's in a different part of the country. At this point, all the lowest category rooms are sold out, so it's close to $3000 per night for the least expensive option. Still, this is the right thing for the hotel to do, given its unilateral cancellation and lack of comparable alternatives.

While I certainly hope the hotel does right by my client, if it doesn't, it will be paying much more in other ways:

1. The clients have already stated that they never plan to book again with this particular brand.
2. I will certainly mention this risk to all TravelSort clients that consider this particular hotel or any of the brand's hotels for future stays.
3. I have already notified Virtuoso of this hotel's actions. Virtuoso can and does terminate hotels that underperform and receive complaints from Virtuoso advisors.
4. I suspect that there will be one or more negative TripAdvisor reviews that reference this hotel's cancelling of confirmed client reservations, without much advance notice.

Have you had a hotel notify you in advance that it was canceling your confirmed reservation, and if so, what reason did the hotel give, and how did you respond?

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