Staycation lifeline won't save hotel jobs

Top News | Sophie Hui 6 Oct 2020

Staycations helped hotel occupancy rise up to 90 percent during the National Day long weekend, but a hotel federation says the locally driven trend cannot be sustained.

The Federation of Hong Kong Hotel Owners said room rates were half of those of last year, so relying on locals cannot be a long-term model for the industry.

If border controls could not be relaxed by the end of the year, layoffs will be inevitable after the end of the government's wage subsidy scheme, said its executive director, Michael Li Hon-shing.

"It won't help much if hotels rely solely on local guests, but in the current predicament, there is income to pay for some salary expenses and utility bills, hoping to reduce the monthly loss," Li said. "If the situation does not improve by the end of the year or the beginning of next year, if borders cannot be fully or partly reopened, then the hotel industry has no choice but to continue to do business in the local market."

Occupancy rates increased to 60 to 70 percent during the four-day National Day weekend, compared to 30 percent on weekdays and 40 to 50 percent on weekends, he said.

Immigration Department figures showed only 928 mainland and foreign visitors arrived in Hong Kong during the four-day holiday from last Thursday - down 99.8 percent from last year's 566,602 mainland and foreign visitors.

Hundreds of millions in the mainland broke free in their first major national holiday since the country beat its coronavirus outbreak, filling airports and train stations on Thursday, where more than 1,000 tourist attractions are offering free or discounted tickets during the holiday.

The eight-day Golden Week holiday sees a great movement of people trying to go home or take holidays, with the tourism sector experiencing a strong rebound.

Massive traffic jams appeared on highways as people were going back home or elsewhere, while train stations including Shanghai Hongqiao and Wuhan Hankou were full of passengers. The Ministry of Culture and Tourism said the country saw 425 million domestic tourist visits in the first half of the holiday, with total revenue of 312 billion yuan (HK$356 billion).

Back in Hong Kong, Sam Lau Kung-shing, chairman of the Tourist Guest Houses Federation of Hong Kong, said occupancy at his guesthouses was less than 10 percent during the long weekend as he had no new customers.

"My guesthouses did not take in new guests due to the pandemic concern and we have cut down on manpower so there are only eight to 10 long-term tenants now," Lau said. "So the National Day long weekend did not affect us as we didn't take in any new guests."

He said guesthouses also faced competition from Airbnb as well as unlicensed and shadow guesthouses, with many visitors preferring to stay in hotels when they come to Hong Kong.

Many guesthouses have closed during the pandemic, while some have transformed to subdivided units, he said.

President of the Hong Kong Party Room Association, Lam Hong-yin, said party rooms were fully booked during the long weekend but revenue was halved due to the four-person social gathering cap.

Speaking on a radio program yesterday, Lam voiced dissatisfaction that hotels are not subject to the same social distancing rules, with many people holding parties in hotel rooms.

He believed this could have created a loophole as people may not wear masks, keep social distancing or eat in the room.

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