Arifur Rahman Rabbi
With a resurgence of Covid-19 and renewed travel restrictions, star-rated hotels in Bangladesh, particularly the five-star ones, continue to reel from a severe drop in bookings caused by the pandemic.
The industry witnessed its worst year in living memory and now people in the sector want tax exemption and financial incentives for their survival as it has become hard to meet management expenses and pay salaries of staff members.
These hotels now hardly have any guest as most of their local and foreign guests have cancelled their bookings. Events organised by various organisations, those usually keep the hotels abuzz, were also cancelled, bringing down revenues.
More than 80 per cent of the five- quality hotels usually remain full with guests during normal days, but after the spread of Covid-19 it dropped to five to seven per cent.
The Bangladesh International Hotel Association estimates the loss in the industry for Covid-19 at Tk 3,500 crore since March 2020.
Insiders said that 90 per cent of the guests in five-star hotels in Dhaka and Chattogram were foreigners and most of them were foreign buyers in the garment sector, inspectors or employees of various projects and officials of diplomatic missions and international organisations.
Star-rated hotels in Bangladesh have two business orientations. One group, which is situated at tourist destinations, mainly focuses on tourists and tries to meet their requirements. And the other group, mostly situated in major cities, focuses on international trade and business.
The business-oriented hotels in cities suffered the most in the pandemic, said the insiders.
When the Covid-19 infection rate came under control in late 2020, the government relaxed various issues, including opening a hotel in compliance with health regulations.
Realising the opportunity, people who remained stranded at home for a long time surged to different tourist spots, especially Cox's Bazar, Chattogram and Sylhet and the hotels in such tourist destinations could cover a portion of their loss in the previous areas.
The scenario went reverse a few weeks back with the resurgence of corona infection and the imposition of lockdown and restrictions. Eerie of silence now rules at most of the hotels.
There are 17 five-star hotels in Bangladesh—nine in Dhaka, four in Cox's Bazar, one each in Chattogram, Jashore, Bogura and Moulvibazar. There are six four-star hotels and 20 more three-star hotels across Bangladesh.
The hotel owners have no accurate statistics of hotels without star ratings but estimate that there are about 10,000 big and small hotels across the country.
Platinum Hotel’s head of operation Md Alamgir Hossain told The Business Post that they used to have 70 to 80 per cent of their accommodation capacity booked during normalcy. Sometimes, it even goes above 90 per cent. "Now we have 5 to 7 per cent of our accommodation capacity booked," he said.
"In usual months, the hotel’s revenue stood at around Tk 3 crore. But after the pandemic spread, it slumped to less than Tk 10 lakh a month," he said.
The holy month of Ramadan always brings huge business opportunities for the hotels, but in the past two Ramadans it has lowered to less than 10 per cent, he said.
Alamgir said that they had 45 per cent of their accommodation and services booked for Ramadan, but after the imposition of lockdown, all the bookings were cancelled.
During Ramadan, the hotels do business with room rental, hall rental for events and restaurants. Room and hall rent is now zero and restaurants have only takeaway services.
"The earnings from restaurants in Ramadan are mostly spent on utility bills. Despite that, we are continuing with it to overcome the financial loss," he said.
Md Mahmud Hassan, head of sales and marketing at Dhaka Regency Hotel and Resort Ltd, told The Business Post that now each of their operations was now run by only 30 per cent of employees.
"This is a big problem. We are losing a lot of skilled employees. Salary deductions are happening in many cases due to lack of business," he said.
"Our business has now come down to 25 per cent. If someone books a room, they are being offered discounts again. Loss is coming from all sides, " he added.
Mahmud Hassan said that they started a home delivery service of food and iftar. "We opted for it just to keep the business running," he said.
Md Mohsin Hoq Himel, secretary of the Bangladesh International Hotel Association, said that the pandemic pushed the hotels into dire straits. "Whereas previously 80 per cent of accommodation facilities were booked, it is now down to 5 to 10 per cent."If such a situation prevails, it will not be possible for the hotels to continue operations, " he said.
The Bangladesh International Hotel Association sought the intervention of the prime minister to overcome the current situation. It said that the hotel businesses affected by the pandemic should be brought under the incentive package announced by the government.
It also sought exemption for all utility bills, including electricity, water and gas.
