Hotel business still far from normal

Photo: Salahuddin Ahmed.

The star hotels based in Dhaka are still far from riding out the Covid-19 rampage as they now see their income dwindling. Almost 80-85% of their seats remain vacant due to a lack of guests.

Their business may not be restored any time soon, thanks to a fresh surge in Covid cases in the last one month, sector insiders fear.

However, hotels in Cox's Bazar – a busy tourist spot of Bangladesh – are better off in terms of business as around 50-60% of their seats are occupied by tourists.

Meanwhile, those Dhaka hotels that had had some business by providing accommodation to Covid-19 frontline fighters for around six months still have arrears of a minimum of Tk20 crore from the government.

For all these reasons, sector players fear an overall impending loss of around Tk7,000 crore at the end of the current year. They are also alarmed that they may not be able to repay their bank loans.

Business insiders said they had to resort to both furloughing and laying off employees to cut costs for the survival of their business.

The five-star Dhaka Westin, one of the most sought after hotels in the capital, has been witnessing an average occupancy rate of 11% for the last few months.

The hotel has 235 rooms in total but only 22 of them have guests now. In December, the occupancy rate is only around 13%, said Jane Alam Shawon, director (revenue strategy) of the hotel.

"We had 5-7% occupancy following the announcement of general holidays in March. When the shutdown was lifted, the guest flow went up by double digits and peaked in September and October," he added.

Unique Hotel and Resorts Limited owns Dhaka Westin. They have two other hotels in the capital, The Sheraton Banani and Hansa.

Shawon mentioned that business in those two hotels was also in a similar condition.

The hoteliers said their business had mainly three sides: room business, banquet hall and restaurant business.

The room business is gloomy. Meanwhile, the banquet business is currently almost zero in most hotels as there is no national or international conference because of the pandemic.

However, hotels were surviving, though barely, with their restaurant services, they added.

Dhaka Westin, with its restaurant, now serves around 20-25% of the guests it used to do before the pandemic.

Six Seasons, a four-star hotel in the Gulshan area, has 15% of guests on average now.

Md Al Amin, general manager of the hotel, said, "Until the vaccination starts, we do not have any hope for a regular business. Now, we are trying to survive through restaurants and some room business."

"We are having 15-20% of the restaurant business we had before the pandemic. Now some guests are coming to our restaurant," he added.

Meanwhile, the guest occupancy rate at Hotel Intercontinental and Dhaka Radisson Blu is around 20-25%, sources said.

The restaurant and banquet business at Hotel Intercontinental is better than it had expected. The number of meetings organised here is gradually rising, said a top official of the hotel, wishing anonymity.

He, however, said the hotel was not allowing more than 100 guests at a time at wedding parties in order to ensure social distancing.

A Radisson Blu official said international travellers were not coming to their hotel yet.

If flight availability did not increase, the number of guests at posh hotels would not peak too.

Cox's Bazar hotels in better business

The star hotels in Cox's Bazar are doing business better than their Dhaka-based counterparts.

The work-from-home for around six months due to the pandemic made the people restless for fresh air in order to refresh themselves, which ultimately has turned into a blessing for Cox's Bazar hotels and resorts.

Royal Tulip Sea Pearl Hotel and Resort, a five-star establishment, now has around 70-80% of its seats occupied by guests.

Wasikur Rabbi, senior duty manager of the hotel, said, "We have had a more than 70% guest occupancy rate in the last three months."

Abdul Kader Mishu, director of the five-star Ocean Paradise Hotel and Resort, said, "We have 250 rooms and almost 50% of them now host guests."

He mentioned that most inbound guests came to the hotel during the weekend, but a spike in Covid-19 cases had slightly led to a slump in the business.

The two-star category hotel White Orchid has around 40-50% of guests compared to its capacity.

Bills for doctors' lodging still unpaid

At least 35 hotels in Dhaka have done some business by hosting health professionals dealing with Covid-19 patients.

But Bangladesh International Hotel Association (Biha) - - claimed the government still owed a minimum of Tk20 crore in the form of bills to the host hotels.

"We accommodated health professionals in different star category hotels from April to September this year at very low costs, Tk500-5,000 per night, as per a request by the Directorate General of Health Services (DGHS)," said Khaled-Ur-Rahman Sany, co-chairman of the disaster management committee of Biha and also managing director of Golden Tulip - The Grandmark Dhaka – a four-star hotel.

"My hotel has an unpaid bill of Tk2 crore from Dhaka Medical College and Hospital. We have sent a letter to its authorities about the bill; they have assured us with just a promise to pay the bill."

When hoteliers are struggling to survive, these unpaid bills had left them in more disarray, he added.

He noted that most of the unpaid bills were from Dhaka Medical College and Hospital and some others from Kurmitola General Hospital and Mugda General Hospital.

Loan repayment big challenge

Entrepreneurs of star hotels and resorts built these businesses on 60-70% bank borrowings.

Now, loan repayment has become a big challenge for the entire sector as the pandemic has brought the sector to a standstill.

Shahid Hamid, adviser to the board of directors of Dhaka Regency, a five-star hotel, said, "We have around Tk90 crore in loans from Shahjalal Islami Bank. The monthly instalment is around Tk1.5 crore. But we have gone irregular in loan repayment amid the pandemic."

"The monthly turnover of our hotel before the pandemic was around Tk8 crore. But now, the poor occupancy numbers have put the hotel under pressure to repay the loan," he added.

In such a situation, Biha has applied to the prime minister for interest waivers from March to December this year, and starting the current instalment from March next year.

Besides, the association has demanded utility bill waivers and cash assistance for employees.

Biha leaders confirmed they did not get any financial or policy support amid the pandemic.