The local hospitality industry has been severely impacted by the coronavirus pandemic and many hotels in Kuala Lumpur are facing partial closure as their occupancy rates have dropped to a massive low.
Several four and five-star hotels in Kuala Lumpur said their occupancy is currently below 10 per cent and their business is partially closed, temporarily until the situation improves to remain viable.
The escalating number of infected cases has led to the country being placed under the Movement Control Order (MCO), until 14 April 2020. With the exception ‘essential services’, all other business activities have literally slowed or come to a complete halt.
It was reported that the Malaysian Association of Hotels (MAH) has projected a revenue loss of RM560.72 million for just the MCO period, with occupancy rates projected to fall to a staggering 11 per cent.
MAH president Kamaruddin Baharin said hoteliers are projecting a much lower occupancy rate for the coming months due to the pandemic.
“We are looking at an average occupancy for Malaysia of nothing more than 25 per cent in June, and that is if the MCO ends on April 14 and the outbreak is brought under control,” he said in a statement.
He said recovery is not expected until the third quarter, with the industry putting their bet on the year-end holidays to make up for losses suffered in the first half of the year.
Some city hotels are still surviving as they have long term staying guests coupled with short term guests who have extended their stay because of the MCO, said a top five-star hotelier who spoke on condition of anonymity.
In March 2003, the Severe Acute Respiratory Syndrome (SARS) virus spread across the Asia-Pacific region, causing widespread disruption. There was a significant impact on the tourism industry due to travel restrictions and booking cancellations.
Although the spread of SARS was under control in four months, it took a further eight months for tourist arrivals to rebound and some 18 months for the market to fully recover. The hotelier expects the impact from Covid-19 will be long term and he feels that the RM250 billion ‘Caring Economic Stimulus Package’ will do very little to cushion the impact going forward.
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