Three hotels to be closed, Penang operators say no choice

CORONAVIRUS | With the movement control order (MCO) being extended for the third time until May 12, hotels in Penang are facing closure due to travel restrictions and the lack of income from tourists.

Plenitude Bhd announced today that three of its hotels - Mercure Penang and Gurney Resort Hotel and Residences in Penang and Travelodge in Ipoh, Perak - will be closed.

Apart from the closure of the three hotels, the company's board also announced the downsizing of operations in other hotels owned by the company.

"This decision is a direct result of the Covid-19 pandemic which has severely impacted the company’s hospitality businesses."

"With domestic and worldwide travel restrictions, the company’s hotels have suffered a significant decrease of business and the company has no alternative but to downsize its business and operations," the company said in a filing with Bursa Malaysia today.

Plenitude added that it is closely monitoring the situation and taking all necessary precautions to ensure the safety of guests and staff.

Jazz Hotel

Over the weekend, it is learnt that the 30-storey, 255-room popular Jazz Hotel in Tanjong Tokong would cease operations by the end of the month due to the Covid-19 pandemic.

Malaysian Association of Hotels (Penang branch) chairperson Khoo Boo Lim said each hotel would have to make a business decision whether to close or downsize to survive through this crisis.

He said as of now many owners are in a dilemma due to market uncertainty as hospitality hotels will be one of the industries recovering last as people will not be confident of travelling even if this pandemic ceased.

"So owners will consider their options.

"Some, who are not confident that the business will be coming in the next three to six months or so will have to take the decision to close temporarily and retrench the staff," he told Malaysiakini.

Khoo said the subsidy from the government is not sufficient to sustain the retention of staff and when the timing is right, a hotel can reopen and rehire.

"In fact, I personally feel that some owners can even consider refurbishing their property during this closure as it's very difficult to do so in normal times.

"With an upgrade, a hotel can raise its average room rate by offering a better quality product. Penang is known to have one of the lowest room rates in Malaysia.

"As the old saying goes, you live to 'fight another day'. Like it or not this is the reality of the crisis," he said

Khoo said many hotel employees, unfortunately, would lose their jobs and called for the state government to look into a retraining programme for these unemployed people.

He said those working in hotels have many talents and retrenched staff can fit into many other industries if they are given the opportunity.

"In fact, this is the best time for us to reduce our dependence on foreign workers. Locals must wake up, take back and do the job (given to foreign labour)," he said. - Mkini