Malaysia's hoteliers report brisk business since borders reopened

Kuala Lumpur

A WEEK after Malaysia reopened its borders, hoteliers say that local and international tourists - deprived of holidays for the better part of the last 2 years - are now willing to splurge on higher-end rooms when they travel.

CBRE Hotels associate director Teo Junrong said the majority of tourists were generally price-sensitive before the pandemic, but with safety being their top concern on their travels, many visitors are spending a greater proportion of their travel budget on more expensive hotel rooms.

"For those who already crave travelling for so long, they tend to splurge on lifestyle and experiential vacations. We foresee there will be greater spending on bigger or more luxury rooms, or in more upscale hotels," he told The Business Times.

Tan Ming Luk, the Malaysia and Singapore country head of budget hotel chain Oyo, has observed similar trends and he plans to add more and different types of hotel into the group's portfolio.

"Previously, our focus was budget hotels in the Kuala Lumpur city centre, but now we are branching more into the leisure market, a more premium segment, such as Langkawi, Kota Kinabalu in Sabah and Penang."

Pre-pandemic, OYO Malaysia and Singapore had over 1,000 hotels in its booking platform, but that number has fallen by about 20 per cent to 800 today. With Malaysia's borders now reopened, he is confident about doubling that number to about 1,600 by the end of this year.

Prior to the border closure, some 26.1 million international tourists visited Malaysia and racked up RM86.1 billion (S$27.8 billion) in receipts in 2019. Earlier this month, Malaysia's Tourism, Arts and Culture Minister Nancy Shukri said the country hopes to have 2 million international arrivals by the end of this year.

In the first 4 days since borders reopened on Apr 1, Malaysia welcomed some 126,400 travellers, with Singapore, Thailand, Indonesia and India the largest sources. The top 5 countries for arrivals into Malaysia in 2019 were Singapore, Indonesia, China, Thailand and Brunei, according to Malaysia Tourism Promotion Board data.

For now, hotels are reporting brisk business. G Hotel Penang has seen bookings for April and May go up by at least 10 per cent compared to when the borders were closed.

Sunway Hotels and Resorts, which operates 9 hotels in Malaysia, has also received numerous enquiries from overseas travellers, mostly from Europe and the Middle East, for stays in the third and fourth quarters of this year.

Alex Castaldi, senior general manager of Sunway City Kuala Lumpur Hotels, said the company has considerable enquiries for stays mainly from Europe and the Middle East for Q3 and Q4 this year.

Although Malaysia hoteliers are upbeat that the room bookings will continue to increase in coming months, OYO's Tan cautioned that the border reopening is "not a magic pill" that can revive the industry.

"It also depends whether other countries are ready to reopen their borders as well, such as China, which has been the biggest spenders in the global tourism market," he noted.