Bahrain's hoteliers in plea to revive sector

Occupancy rates in five-star hotels fell to 43%, down from 53% a year ago

  
Hotel Room. Image used for illustrative purpose.

Hotel Room. Image used for illustrative purpose.

Getty Images

Bahrain's hoteliers are requesting an urgent rescue fund, utility bills waiver and flexible Covid-19 regulations to save the sector from hitting rock bottom.

Industry experts say the delay in opening the King Fahad Causeway, which has been closed since March and is expected to reopen on January 1, postponing dine-in services in restaurants and cafes (pushed now to October 24 from September 24) and the cancellation of mega-events have hit the hospitality industry hard.

“There won’t be a major flow of traffic on the causeway until it reopens on January 1 and this is subject to revision by authorities,” Bahrain Chamber of Commerce and Industry’s (BCCI) hospitality and tourism committee chairman Jehad Amin told the GDN.

“We all have to live with this situation and feel the heat as 80 per cent of arrivals are from Saudi Arabia,” he said during an exclusive webinar featuring representatives from four- and five-star properties.

Mr Amin said one of the biggest problems hotels continue to struggle with is the high utility bills that should be waived, along with government fees.

Utility bills of some four-star hotels were to the tune of more than BD40,000 for three months – at a time when occupancy levels were in single digits or less than 10 per cent, according to documents obtained by the GDN.

“The committee has written a letter to the Industry, Commerce and Tourism Minister regarding the energy bills issue and also urging a waiver of annual tourism licence renewal fee for hotels (BD8,000 for five-star and BD5,000 for four-star hotels,” said Mr Amin.

“Restaurants in hotels did not benefit from Tamkeen’s financial aid, and now with indoor dining postponed by a month, hotels need a special stimulus package to cover all these aspects.”

He suggested that funds saved by the Bahrain Tourism and Exhibitions Authority (BTEA) – by suspending its tourism offices abroad due to the pandemic, cancelling roadshows and other exhibitions – should be diverted towards a massive marketing campaign to help hotels.

“The challenge is we don’t know when to start promoting Bahrain as a key destination under these circumstances.”

He further suggested authorities to waive the BD60 fee for Covid-19 tests on tourists and incoming passengers at the airport, and accept PCR tests from passengers from internationally approved centres prior to departure.

Meanwhile, committee deputy chairman Ebrahim Kooheji said the hospitality sector employs a large number of foreign workers, which made it one of the biggest revenue generator for Tamkeen through the Labour Market Regulatory Authority fees, and requested rescue packages for hotels.

Elite Hospitality Group chief operating officer Sarosh Aibara pointed out that mega-events in Bahrain have been cancelled or rescheduled such as the Bahrain International Airshow, Jewellery Arabia and Autumn Fair.

“We need an aggressive marketing campaign rather than a soft PR exercise to promote Bahrain and boost the hospitality sector that is a key non-oil contributor to the country’s GDP,” he said.

“Big events have been cancelled, room occupancy levels are low and there is no breakthrough yet in a Covid-19 vaccine – all these have dealt a big blow to the industry that is now struggling to stay afloat.”

Mr Aibara said in addition to the high utility bills hotels also pay staff salaries, high rents and annual municipal tax (about BD14,400 for four-star and higher for five-star).

Echoing the sentiments, InterContinental Regency Bahrain area general manager Philipp Economou said the industry welcomed the initial government support but said more needs to be done.

“The local market cannot alone help all the restaurants and we need regional travellers to come back after the travel restrictions are eased,” he said.

“How can we sustain or manage our costs with a delayed comeback at a time when it is a challenge for us to deal with our assets – our people who need to be retained and trained on new protocols.”

OCCUPANCY

Crowne Plaza general manager Bruno Hivon highlighted the need for urgent measures to help the industry survive.

“Even if there is one to two per cent occupancy levels you need minimum staff to conduct daily operations, and we need to see it from a dimension that you don’t want the hospitality and restaurants sector to collapse.

“Some outlets may never open again and this will have a negative impact on recovery once leisure and business travellers start coming back.”

Miami Property managing director and owner of Swiss-Belhotel Seef Bahrain Fawaz Bokhowa said he was aware of some properties that have been permanently closed or are up for sale.

OFFLOAD

“From an investor’s point of view, operations need to be drastically reduced and properties offloaded which is currently being done,” he said.

“Beachfront resorts did business but the city hotels are in a dire situation, and they are being supported by owners who run other companies.

“At the end of the day, we are part of an ecosystem that includes food suppliers, laundry, government levy, maintenance, security and other aspects, if one of us falls everyone gets affected.”

There are about 130 hotels in the country and 68 service apartments with more than 15,600 rooms in total, according to rough estimates.

BTEA statistics for Q1 2020 point to a sharp 47pc decline in the number of tourists, a 49.5pc decline in total tourist nights and a 55.4pc decline in total tourism expenditure.

Occupancy rates in five-star hotels fell to 43pc, down from 53pc a year ago, with four-star hotels seeing a similar decline to 36pc from 46pc a year ago, according to the Bahrain Economic Quarterly for Q1 released by the Finance and National Economy Ministry.

sandy@gdn.com.bh

A gourmet response – Page 7

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