Luxury hotels fall silent as business travellers fade away

Luxury hotels in Dhaka are yet to resume normal business activities as foreign and local clients do not feel confident in travelling to the country given that the overall situation is still unstable.

Industry insiders said the situation has slightly improved compared to mid-July, when nationwide protests against the government's quota system for public jobs took hold. However, it is still at an unsatisfactory level.

"Since mid-July, the occupancy rate has dropped to 30 to 35 percent from the normal range of 78 to 80 percent," said Mohammad G Jisan, senior manager of sales at the Radisson Blu Dhaka Water Garden.

Usually, those travelling for business purposes occupy 70 to 80 percent of their rooms, he said. However, the number of such travellers decreased significantly, especially after August 5, when the Sheikh Hasina-led Awami League government was ousted by a mass uprising.

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Luxury hotels hit hard by unrest

Those travelling for business purposes account for 10 percent of room occupancy at present, he said, adding that although some guests related to international and non-government organisations are arriving, the number is negligible.

Furthermore, out of the 200 rooms at the Radisson Blu Dhaka Water Garden, 50 rooms were usually booked by airlines. But that number has also fallen as the number of foreign flights from Dhaka has been reduced.

Given the dire situation, Jisan said that the hotel was not generating enough revenue to cover its operating costs.

"This applies not only to Radisson, but to almost all five-star hotels," he said. "If this situation continues for the next six months, some hotels will have to close."

Mohammed Nafeuzzaman, public relations manager at the Pan Pacific Sonargaon Dhaka, said it is natural for the hotel business to suffer from a slowdown given the situation that has persisted since July.

"Currently, our hotel occupancy rate is 20 percent on some days and 30 percent on others. But it is around 65 percent when conditions are normal," he said.

According to Nafeuzzaman, the hotel business goes through highs and lows.

"We are not an occupancy-based business. Our business is event-based," he said, adding that the situation may improve next month as a cricket team will arrive at the hotel.

Mahmud Hassan, director of sales and marketing at Dhaka Regency Hotel and Resort Limited, said the business has been in a fragile state since mid-July, when there were virtually no guests.

He added that many foreign clients had cancelled bookings due to the unstable situation since July 18.

"At that time, we were very stressed about how long this situation would last," he said.

However, the situation has slightly improved over the past week although the occupancy rate is still below 40 percent, Hassan stated.

He also said there was a dearth of corporate clients as buyers of garment products are yet to start visiting Bangladesh after the political changeover.

Furthermore, different countries such as the US and Japan are yet to withdraw travel alerts that have negatively impacted the hotel and hospitality industries, he said.

Besides, as the law-and-order situation is yet to improve, foreigners do not feel comfortable visiting Bangladesh at this moment, he added.

He said a majority of their guests come from India, the US, and China, but they are hesitant to travel to Bangladesh at this moment.

Tuhinoor Sultana, cluster public relations manager at The Westin Dhaka, said business was on the road to recovery after suffering for one-and-a-half months as the occupancy rate increased significantly over the past few days.

She added that the occupancy rate had dropped to 10 percent during the height of the unrest and that scheduled programmes such as expos and seminars were cancelled one after another.