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Major hotel companies are waiving cancellation fees for guests who planned to stay at their hotels in Mexico in response to the swine-flu crisis.

Starwood Hotels & Resorts Worldwide Inc. (HOT), InterContinental Hotels Group PLC (IHG) and Global Hyatt Corp. all said they will waive cancellation fees for arrivals in Mexico. The lodging chains haven't received any reports of swine-flu contagion at their properties.

Carolyn Hergert, an InterContinental Hotels spokeswoman, said the company will waive fees for guests in the U.S and Canada "on a case-by-case basis," and noted that the company has seen a rise in cancellations at Mexican properties.

The Centers for Disease Control and Prevention issued a travel advisory Monday recommending that Americans avoid all nonessential travel to Mexico, where the outbreak was first seen. The death toll in Mexico's influenza outbreak has risen to 149, with 20 being confirmed as swine flu, of about 2,000 possible cases. Meanwhile, the number of human cases of swine flu in the U.S. has risen to 40, but there have been no fatalities.

"At this time, we have seen no material cancellations as we continue to closely monitor the travel situation," Starwood said in a statement.

The mounting health crisis couldn't have come at a worse time for the recession-battered lodging industry, which is grappling with steep declines in consumer spending. The swine-flu concerns fueled a sell-off in hotel stocks Monday as Marriott International Inc. (MAR) fell 5.1% to $21.17 and Starwood dropped 11% to $18.55.

"Certainly it's bad timing ... (for) an industry that's already getting hurt," said Smedes Rose, an analyst at Keefe Bruyette & Woods.

Rose said it's too early to gauge how severely swine flu will impact the hotel industry given uncertainty about how widespread the virus will reach. He noted that the SARS epidemic in 2003 had a big impact on revpar, or revenue per available room - the key performance measurement in the hotel industry.

-By A.D. Pruitt, Dow Jones Newswires; 201-938-2269; angela.pruitt@dowjones.com