BUDGET hotels in the east coast have suffered a huge blow now just as the their sector was recovering but they are experiencing close to 100% drop in occupancy rate due to the monsoon season and flooding, proprietors said. 

Malaysia Budget and Business Hotel Association president Sri Ganesh Michiel said about 500 of its members in Terengganu, Kelantan and Pahang are reeling from the flood.

He said the decline in room take-up started in mid-November and continued into early December, resulting in 60% losses.

“Currently, they are facing up to 100% losses as floods keep visitors away,” he told The Malaysian Insight. 

Ganesh said that it might take about two months for hotel proprietors to recover from their loss of income.

“The main issue they (operators) are facing is that they have yet to recover from the pandemic and now they are hit with this (flooding).”

He said that most of their bookings were cancelled as the monsoon reached its peak and bad weather intensified.  

The number of flood evacuees stood at 27,396 in Terengganu last night. 

In Kelantan, the number people seeking shelter fell to 24,690 last night, compared to 25,755 in the evening.

As for Pahang, 23 people remained in one relief centre last night, down from 35 in the morning.

However, budget hotels in Malacca, Penang and Johor have not been affected, said Ganesh.

“Hotels that are located around the city and in tourist areas are hitting more than 80% in occupancy rate. Rooms are full on the weekends, while it’s around 60% on weekdays.”

Ganesh said that the group currently has 2,700 members across the country, including in Sabah and Sarawak. 

He also said it is not easy to attract visitors as budget hotels are competing with numerous unlicensed accommodation providers.  

“The illegal operators are also on online travel booking platforms as it is not regulated by the government.

“So, anyone can get a cabin, put a bed in, air-conditioning and then sell the space online. 

“Because the prices of these unlawful listings are cheaper, it is taking a longer time for the operators to recover their finances.”

Ganesh hopes the government will look into regulating online travel platforms. 

“Only proprietors who are registered and licensed should be allowed to operate.”

He added that the business sector is seeking a long-term recovery plan and will be writing to the government next month. – December 23, 2022.