Covid blow for guesthouses

Local | Erin Chan 4 Jun 2020

At least 22 guesthouses and a hotel have fallen victim to the coronavirus pandemic as they have either not renewed their licenses upon expiry or withdrawn renewal applications.

In a written reply to lawmakers, ommerce and economic development secretary Edward Yau Tang-wah said yesterday that licenses of 22 guest houses and one hotel were invalidated between February and May, according to statistics from the licensing authority of the home affairs department.

He said the social unrest starting last year and the pandemic have taken an unprecedented toll on the business of guest houses and hotels.

Yau said this was triggered by the few visitor arrivals to the city, which saw a drop of 99.9 percent year on year in April, with only 140 people arriving daily on average.

Hotel room rates dropped by 31 percent year on year in the first quarter of this year, and the drop accelerated to 39 percent in April, he said.

The occupancy rate of hotels fell by 52 percentage points year on year to 40 percent in the first quarter of this year, while it fell by 55 percentage points to 34 percent in April.

The average room occupancy rate of guest houses decreased to 39 percent in the same period, and the figure decreased to 38 percent in April.

Yau said the government had set up support scheme to provide relief for licensed guest houses and hotels.

Under the two schemes, each eligible guest house will be provided with a one-off subsidy of HK$50,000 or HK$80,000, and each eligible hotel will be provided with a one-off subsidy of HK$300,000 or HK$400,000.

Meanwhile, some tour agencies said most of their staff need to continue no-pay leave as overseas tours have to be temporarily suspended or canceled in face of the extension of the entry restriction for those returning from overseas to September 18.

Big Line Holiday said that it has temporarily suspended all overseas tours and required its staff to continue with no-pay leave.

Miramar Travel said it cannot resume overseas tours in the short term, as most flights have yet to resume.

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