Travel & Tourism – The Real Estate Roundtable

Biden Administration to Ease Pandemic Travel Restrictions; Senate Hearing Considers Legislation to Support Travel and Tourism Economy

Posted on October 15, 2021October 27, 2023 by Trey Jackson

The Biden administration today announced that fully vaccinated travelers from Mexico and Canada will be allowed to enter the United States starting Nov. 8 for “non-essential purposes, including to visit friends and family or for tourism.” The easing of travel restrictions provides a renewed opportunity for international travel to boost domestic economic growth. Additionally, next month will see the end of a pandemic-driven, 18-month ban on travel from 33 countries, including members of the European Union. (Reuters, Oct. 15 and New York Times, Oct. 12 | Oct. 8)

Why It Matters

The easing of travel restrictions could help rejuvenate the U.S. tourism industry and commercial real estate’s hospitality and retail sectors, which have been hit hard by the pandemic. Inbound international travel may help CRE through increased spending at hospitality, retail, attractions, health, and investment properties, generating revenues and creating American jobs. According to Marketwatch, relaxed travel restrictions may also
lead to an increase in foreign investment in U.S. real estate.
Secretary of Homeland Security Alejandro Mayorkas stated, “Cross-border travel creates significant economic activity in our border communities and benefits our broader economy.” He added, “This new travel system will create consistent, stringent protocols for all foreign nationals traveling to the United States – whether by air, land, or ferry – and accounts for the wide availability of COVID-19 vaccinations.” (DHS news release, Oct. 12)
Senate Majority Leader Chuck Schumer (D-NY) this week commented, “Since the beginning of the pandemic, members of our shared cross-border community have felt the pain and economic hardship of the land border closures. That pain is about to end.” (Schumer news release, Oct 12)
The American Hotel & Lodging Association (AH&LA) also issued a Sept. 15 report on how hotels are projected to end 2021 with a loss of 500,000 jobs and more than $59 billion in business travel revenue compared to 2019. (AH&LA news release | state-by-state breakdown | market-by-market breakdown)

Bipartisan Senate Efforts

The Senate is preparing legislation to boost inbound travel and tourism to the United States, according to a Sept. 21 Senate Commerce subcommittee hearing chaired by Sen. Jacky Rosen (D-NV), above.
Executives from AH&LA and the U.S Travel Association testified at the hearing, entitled Legislative Solutions to Revive Travel and Tourism and Create Jobs.
Rosen, who leads the Subcommittee on Tourism, Trade, and Export Promotion, announced that bipartisan legislation is in the works to “support the recovery of the travel and tourism economy in the wake of the COVID-19 pandemic and help us build a brighter future for businesses and workers in this key sector for every state in our nation.” (Rosen news release, Sept. 22)
The imminent Omnibus Travel and Tourism Act would establish permanent federal leadership on travel policies, invest in public-private partnerships to increase visits to the U.S., and create a task force to address the pandemic’s impact on air travel. (BGov, Sept. 21)

Full committee ranking member Roger Wicker (R-MS) added his support for the emerging bill, saying that the nation’s travel and tourism challenges are a “bipartisan issue.”

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Seven-Year TRIA Reauthorization Passed as Part of $1.4 Trillion Spending Bill

Posted on December 21, 2019October 27, 2023 by Trey Jackson

A seven-year reauthorization of the Terrorism Risk Insurance Act (TRIA) was approved this week by the House and Senate as part of a year-end funding bill (H.R. 1865). The provision reauthorizes TRIA through 2027, a year ahead of its slated sunset date of Dec. 31, 2020. (TRIA provisions on pages 1233–1236 of the year-end funding legislation).

The measure is part of a massive $1.4 trillion congressional spending deal to fund the government until the end of the fiscal year – Sept. 20, 2020. President Trump is expected to sign two separate funding bills to keep the government open past midnight tonight.

Roundtable Chair Debra Cafaro (Ventas, Inc.) stated, “The Real Estate Roundtable is pleased that TRIA will be extended until 2027. This federal terrorism insurance backstop was enacted following 9-11 and has been extended and reformed several times since. We cannot overstate the valuable safety and liquidity that the program brings to the US economy, businesses of all manner and commercial real estate markets.”

A long-term, “clean” reauthorization of TRIA, well in advance of its expiration, has been a top policy goal of The Roundtable. This was achieved a full year ahead of schedule. (Roundtable background on TRIA)

In addition to TRIA, the omnibus appropriations bill (H.R. 1865) contains several other positive measures affecting real estate. The tax and funding extensions include:

The EB-5 Regional Center Program, which provides visas to foreign nationals who pool their investments in regional centers to finance U.S. economic development projects. The program would be extended until Sept. 2020. Department of Homeland Security (DHS) regulations that took effect in November presently govern key elements of the EB-5 program regarding investment levels and Targeted Employment Area (TEA) definitions.
The National Flood Insurance Program. Without the extension, the program’s borrowing authority would have been reduced from $30.4 billion to $1 billion. The program would also be extended until Sept. 2020. (BGov and CQ, Dec. 20)
Tax measures would be extended through the end of 2020. They include (1) the section 179D tax deduction for energy efficient commercial building property; (2) the section 25C tax credit for energy efficient improvements to principal residences; (3) the section 45L tax credit for construction of new energy efficient homes; (4) the tax exclusion for home mortgage debt forgiveness; (5) the tax deduction for mortgage insurance premiums; and (6) the New Markets Tax Credit;
The Brand USA program would be extended through fiscal year 2027. Brand USA promotes travel to the U.S. through a public-private partnership that is funded through private-sector donations and funds collected from foreign visitors to the U.S.

This week also saw the House pass legislation (H.R. 5377) that would temporarily raise and then eliminate for two years the $10,000 cap on state and local tax (SALT) deductions, which would be paid for by permanently raising the top individual tax rate to 39.6%. This “messaging” bill is unlikely to be taken up in the GOP-controlled Senate and President Trump has also threatened to veto it.

After a flurry of year-end policymaking amid impeachment proceedings, both chambers of Congress recessed today and will return in early January.

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Brand USA Reauthorization Bill Advanced by House Subcommittee

Posted on November 16, 2019October 27, 2023 by Trey Jackson

Legislation to reauthorize Brand USA – the organization that promotes the U.S. globally as a travel destination – easily cleared a markup by the House Energy and Commerce Subcommittee on Consumer Protection and Commerce on Nov. 14.

Brand USA is a public-private partnership that attracts international travelers to the U.S. to encourage tourism spending at America’s hospitality, retail, attraction and other properties. The marketing organization operates at no expense to taxpayers – private sector contributions fund the program, matched by U.S. government fees collected from foreign visitors who enjoy visa-free entry to the U.S. The federal portion of Brand USA funding is scheduled to expire in September 2020.
Subcommittee Chairman Frank Pallone (D-NJ) during the House markup of The Travel Promotion, Enhancement, and Modernization Act (H.R. 3851) stated, “Tourism is critical to our economy and every one our communities. Overseas travelers spend more than their domestic counterparts—an average of $4,200 per trip. It is critical that we renew Brand USA as soon as possible.” (Rep. Pallone remarks, Nov.14)
In the Senate, the Committee on Commerce, Science and Transportation passed the “Brand USA Extension Act” on July 24. S. 2203 would extend the federal cost-share until 2027, and increase the foreign traveler fees that pay for the federal portion. (Roundtable Weekly, August 9)
The Real Estate Roundtable is part of the Visit U.S. Coalition which advocates for Brand USA reauthorization. The coalition, led by the U.S. Travel Association (USTA) and the American Hotel and Lodging Association, also includes the American Resort Development Association and the U.S. Chamber of Commerce.
U.S. Travel Association Executive Vice President of Public Affairs and Policy Tori Barnes noted, “International visitation to the U.S. is flat at a time when global travel is booming, which means that we are leaving a huge opportunity for economic growth on the table. The situation would be far worse without Brand USA’s demonstrated effectiveness at bringing lucrative international visitor dollars to our shores, and House and committee leaders are to be commended for recognizing the urgency to renew Brand USA this year.” (USTA press release, Nov. 14)
The importance of international travel to the domestic economy, job growth, and CRE was the focus of a panel discussion during The Roundtable’s 2018 Annual Meeting. (Roundtable Weekly, June 15, 2018).

The Visit U.S. Coalition is urging inclusion of a bipartisan Brand USA reauthorization bill in must-pass legislation before the end of the year.

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“VisitU.S.” Coalition, Roundtable Advance Policy Recommendations to Boost Economic Growth

Posted on May 13, 2019October 27, 2023 by Trey Jackson

Robust international travel helps power economic growth and commercial real estate through tourism dollars directly spent at U.S. hotels, resorts, stores, home purchases, attraction, and investment properties. That is the message to policymakers from the multi-industry VisitU.S. Coalition, which aims to safely and securely welcome more overseas travelers to the U.S. – who stay an average of 18 nights and spend approximately $4,360 at hotels, stores, restaurants and attraction properties on business and leisure trips. (VisitU.S. Policy Agenda)

The multi-industry VisitU.S. Coalition aims to safely and securely welcome more overseas travelers to the U.S. – who stay an average of 18 nights and spend approximately $4,360 at hotels, stores, restaurants and attraction properties on business and leisure trips. ( VisitU.S.Policy Agenda )

The coalition advocates for policies from the Trump Administration and Congress to regain the nation’s lost share of the global travel market by 2020, which will result in 88 million international visitors who directly support 1.3 million U.S. jobs and $294 billion in travel exports – crucial to achieving the Administration’s economic goals. (Roundtable Weekly Jan. 19 Feb. 9)
To address policies that may encourage or discourage in-bound travel – as well as the impact of the travel and tourism market on CRE – The Roundtable will host a panel discussion during its June 14 Annual Meeting entitled “ Enhancing International Travel and Tourism.
“We should be encouraging international tourism and promoting policies that not only make the visa system more secure and accessible, but also streamline the process,” said Jeffrey D. DeBoer, President and CEO of The Real Estate Roundtable. “Increasing inbound international travel to the U.S. helps power the commercial real estate industry here at home through spending at hospitality, retail, attraction, health, and investment properties – all of which generate revenues to boost overall economic growth and create American jobs,” DeBoer added.
Jonathan Tisch, chairman and CEO of Loews Hotels & Co. spoke about the coalition’s concerns and goals during a Monday interview with CNBC’s “Squawkbox” and at an international hospitality industry investment conference. ( Squawkbox Interview, June 4 and GlobeSt, June 6)
In a June 4 Travel Weekly editorial, Tisch also addressed the Trump Administration’s proposal to eliminate Brand USA, a public-private partnership created by Congress to promote America as the best destination for international visitors. Tisch writes, “The program returns an estimated $28 in visitor spending for every $1 invested – without a single dollar from U.S. taxpayers. Although the fees that fund it were extended, after 2020, those monies will be diverted to the U.S. Treasury instead of Brand USA. Unless this is fixed, the program will be in limbo.”

Led by the U.S. Travel Association and the American Hotel and Lodging Association, the VisitU.S. coalition also includes The Real Estate Roundtable, U.S. Chamber of Commerce and the American Resort Development Association.