The message from attendees of the Distressed Hotel Symposium is clear, and unfortunately, it’s not too optimistic.

And although the pessimistic tone of the conference didn’t spoil my much-anticipated inaugural stay at the Westin Diplomat, a spectacular hotel on the Atlantic seaboard, it gave me a cause to pause.

In a nutshell, the message was the hotel industry is in for a bummer of a summer, and it could be well into 2010 before any hint of recovery pokes its head through the clutter. Most attendees and panelists cited the lack of business travel as the culprit for a bad operational summer for hotels. Although, I think it’s going to be a better summer than anticipated because restless consumers are going to jump in their cars to get away for long weekends because they can’t hop on a plane for an extended vacation. I have high expectations for places such as Wisconsin Dells, Wisconsin; Sandusky, Ohio; Williamsburg, Virginia and the mountains of the west.

But the sobering message from the conference is that most attendees and panelists believe the industry is nowhere near the bottom in terms of getting soon-to-be-defaulted hotel loans cleaned up. Most expect that to begin by the end of this year and not fully be under control until … take a deep breath … 2011. It’s a scary thought that we’re potentially two years away from getting control of a lending situation that spun out of control with a lot of floating-rate debt issued in the 2004-2007 time span. But it is a fact. There’s plenty of commercial mortgage-backed security debt coming due during the next 24 months—some estimate it could be as high as US$750 million. With no capital flowing from lenders, there’s no place for hotel owners to turn to refinance.

Therefore, many good people are going to get caught up in the inevitable wave of foreclosures and bankruptcies. Sure, they knew they were taking a risk when they signed on the dotted line, but no one had bank failures or a global economic crisis on their docket three, four or five years ago.

Neil Shah, president of the Hersha Group of Companies (which includes a hotel management company and a publicly traded hotel real-estate investment trust that has taken a beating during the recession) told me he feels sorry for most of the people who will be wiped out by the current economy because there was little they could do to avoid it. He feels fortunate his company locked into long-term financing deals several years ago and has no maturing debt any time soon.

So, while the outlook is bleak, there’s a silver lining. A number of companies will come through this stronger than ever. Those companies with little or no maturing debt, and those companies who are sitting on cash are going to flourish. The companies with cash will be able to pick and choose hotels to buy when lenders decide to toughen up and force current owners to pony up or lose the asset.

“There will be a time a few years down the road when a few of us will look around and say, ‘2009—I really struck gold that year,’” said Thomas Bennett, partner with Ballard Spahr Andrews & Ingersoll and the moderator the Thursday’s Presidents’ Panel.

Another wild card in the equation is how long hotel brands will allow hotel owners to slide on deferred maintenance and product improvement plans. There will come a day when they’re going to have to get tough and force owners to reinvest in their properties—regardless of the economic malaise the country is in. Again, with nowhere to turn for loans, these owners are going to be on the outside looking in.

That’s where the cash-rich companies will be able to step in. Don’t be kidded that this will only affect mom-and-pop type owners. Expect a number of companies familiar to today’s hotel landscape, to bite the dust—starting with a few of the REITs that won’t be able to keep pace.

So, as I look at the warm azure waters off Florida’s East Coast—and the few tourists that are splashing around having fun—I can’t help but wonder which companies are going to drown in the sea of credit chaos and which are going to be buoyed by the cash on which they’re resting. After listening to panelists repeatedly say the outlook for hotels is gloomy, the only advice appears to be that if you see a life jacket floating by, grab it and hang on for dear life.