The Malaysian hotel industry is expected to double its average occupancy rate

By TIN Media | Hospitality Published 5 days ago on 4 May 2021
Read News


The Malaysian hotel industry, which has been severely impacted by the Covid-19 pandemic, is expected to double its average occupancy rate (AOR) during the Hari Raya holiday week later this month.

The Malaysian Association of Hotels (MAH) reported that the AOR for hotels in the country was 20.5 percent in the first two months of this year.

According to MAH president Datuk N. Subramaniam, the AOR is expected to rise to nearly 40% during the Hari Raya week, which is still significantly lower than pre-pandemic levels.

“The AOR for the Hari Raya week in 2019 was approximately 60%.

“However, for the upcoming Hari Raya, the overall occupancy is expected to be at best no more than 40%, with average rates down between 30% to 70% due to heavy discounting for the domestic market, ” he said.

In comparison to 2019, Subramaniam noted that hotel food and beverage (F&B) dining and events had decreased by at least 60% due to capacity constraints in accordance with standard operating procedures. “Due to interstate travel restrictions, occupancy remains low with little improvement. With the arrival of the holiday season, event and F&B dining rates may rise to nominal levels, ” he said.

He said that the hotel industry lost an estimated RM135 million in revenue due to the Covid-19 pandemic last Ramadan.

Looking past the current year's Hari Raya holidays, Subramaniam is pessimistic about the rest of the second quarter.

“The second quarter is as good as gone, especially with the interstate travel ban being extended again and rising daily cases hitting new highs.

“Tax waivers and subsidies, as well as subsidised room packages from Tourism Malaysia and the government is expected and needed to keep the industry afloat, ” he said.

According to Napic, there were 3,445 hotels/resorts across the country offering 260,097 rooms as of the end of 2020.

In Kuala Lumpur, another 128 hotels/resorts (27,543 rooms) were registered as incoming supply, while 95 hotels/resorts (18,737 rooms) were in the planning stage.
According to the National Property Information Centre (Napic), hotel AOR was 58.5 percent in January to September 2019 and 31.6 percent in September 2020.

It mentioned that six hotel and three resort transactions totaled slightly more than RM351 million last year.

“Construction activities were on a low tone as completion, starts and new planned supply declined significantly. There were 19 new hotels/resorts completed in 2020 offering 1,363 rooms, down by 65.4% against 2019 in terms of rooms.

“Starts and new planned supply contracted by 62.2% (2,030 rooms) and 19.2% (1,956 rooms) respectively.”


Email TIN

TIN Media - Travel Industry Network is Malaysia's home grown B2B Travel Industry Media with the most influential B2B online resources including news, research, events, and marketing services and more.