Tough times for hotel sector set to continue

KUALA LUMPUR (June 12): Times are bleak for the hotel industry and it predicts that things will not improve for the time being.

“So far this year, the situation is already worse than in 2020 in many ways, with the average occupancy rate (AOR) hovering at a low 20%, and even that is mainly contributed by [occupants at] quarantine hotels,” Malaysian Association of Hotels (MAH) vice-president C S Lim told The Edge Malaysia in a report.

“This month, we have had extended travel restrictions, including the inter-district ban, and deeper economic impact on businesses and individuals. This means most, if not all, will not be considering leisure travel anytime soon, or even events or activities in hotels in the near future. This is made worse with the quickly diminishing confidence of the general public, both local and international, in Malaysia’s pandemic management,” Lim added.

As a result, the overall AOR and average daily rate (ADR) in 2021 are expected to be lower than last year’s - “Both AOR and ADR are expected to be lower in general compared with 2020,” he explained.

Any time line on when things will get better? “At this rate, we are not likely to see a commencement of recovery until 2023,” Lim revealed.

Lim also “estimated” that another 50 hotels will close temporarily during the current lockdown, in addition to 100 hotels that had to shut either temporarily or permanently last year.

He added that the hotel industry “desperately” needs direction from the government, “including the reopening of borders or implementation of travel bubbles”.

“More importantly, the industry needs additional assistance as most of the previous initiatives implemented are ending this month,” Lim said.

“We need the government to speed up [the National Covid-19 Immunisation Programme], especially for economic frontliners such as hoteliers.”

Read the full report in this week’s The Edge Malaysia

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