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Goodbye, Brownies on The Pillow: Hotels Ditch Services in an Effort to Save Some Cash

The Gramercy Park Hotel, which by the way, is still a five-star hotel.

All of the sudden the outlook for the hospitality industry seems to have gone from bad but with hope on the horizon, to worse with drastic cost-cutting measures now taking place.

Indeed, 2009 has been one of the worst years in history for hotels but yet the best year for travelers looking for steep deals. However, just because you got that five-star hotel for half of its usual price, doesn't mean you'll be getting all the perks you'd expect.

A new report says that hotels have begun dropping stars from their star ratings so that they can reduce their level of services and save money. Some hotels that have already done this? Starwood and Hilton Hotels. And here's why.

Hotel operators need to reduce services to conserve cash. Occupancy rates for luxury hotels worldwide fell to 57 percent in the year through July from 71 percent in the same period a year earlier, a bigger drop than for other types of accommodation, according to Smith Travel Research.

The average daily room rates at the most luxurious hotels around the world dropped 16 percent to $245.13, the Tennessee- based hotel-data company estimates. Prices for mid-range hotels fell about 13 percent to $87.12.

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