Tourists stay away, rooms stay empty
It’s going to be a bleak Christmas for hospitality industry
● There’ll be plenty of room at the inn this Christmas, but the inn may not be open.
Up to half of Cape Town hotels remain closed, international tourism and conferences have dried up and the hospitality sector is consumed by restive fear, rather than festive cheer.
“It’s not coming right,” Valor Hospitality managing partner Tony Romer-Lee told the Sunday Times this week, eight months after the lockdown pulled the rug from under the industry.
“Properties are starting to change hands, investors are changing their focus,” said Romer-Lee, whose company’s portfolio includes Fancourt in George and Matjiesfontein’s Lord Milner Hotel.
The pandemic has delayed the opening of Valor’s Voco hotel in Rosebank, Johannesburg, that it will operate on behalf of Intercontinental Hotels Group. The reopening of the Hyatt Regency in Rosebank has been delayed until mid-2021, he said.
Jeremy Clayton, owner of the President Hotel in Sea Point, said: “It’s devastating. Our core markets are the UK, Germany and the US, and they can’t come in.”
Enver Duminy, the CEO of Cape Town Tourism, is pinning his hopes on domestic visitors. Even with an increase in international flight routes to Cape Town, “there are still only a handful of countries allowed to travel to SA”, he said. “Businesses are struggling without international guests, especially heading into the summer season.”
Labeeqah Schuurman, chief strategy officer at Wesgro, the tourism, trade and investment promotion agency for Cape Town and the Western Cape, said: “As the regulations stand, leisure tourism will remain severely constrained with a considerable risk of further job losses. With the majority of Europe experiencing their second wave of the pandemic we don’t expect many international visitors for the upcoming festive season.”
Lee Zama, CEO of the Federated Hospitality Association of SA, said about 25% of accommodation establishments remained closed. The Western Cape was the worst affected, while KwaZulu-Natalwas leading the recovery.
“We still have some of the top 20 source international markets under the restricted list. This will hamper the recovery efforts,” she said.
A significant number of hotel employees had not received an income in the past few months, said Zama. About 600,000 had registered for the Unemployment Insurance Fund temporary employer-employee relief scheme.
Schuurman saidWesgro’s “We Are Open” drive — one of several marketing campaigns aimed at domestic tourists — had resulted in more than 600 bookings in the past fortnight.
“We see an increase in engagement, exploring accommodation across the province, and feel confident about the number of reservations made to date,” she said. “It is clear that if budget allows, supported with the exceptional offers that are available, families are keen to take breaks.”
Three top-end Johannesburg hotels have shut their doors while the pandemic continues. The luxury Saxon Hotel in Sandton would reopen only “once we can ensure a safe environment for our guests and team”, reads a notice on its website.
In Rosebank, a notice on the Hyatt Regency website says the hotel has “temporarily ceased normal operations and is not currently accepting room, restaurant, bar or other reservations for dates before 30 September 2021”.
When business does resume, guests would be required to wear face masks or coverings in the hotel’s indoor public areas and outdoor areas, it says.
Calls to the Michelangelo Hotel in Sandton went unanswered or were diverted to a generic voicemail account. No rooms were available on its online reservations system.
Another hotel that will be closed over the festive season is the swanky Fairmont Zimbali on KwaZulu-Natal’s north coast.
It closed nine months ago. In September, the hotel’s owner, IFA Fair-Zim Hotel & Resort, went into business rescue.
Potential buyers have to submit offers by December 15. “There are 155 employees who remain on unpaid layoff. Their future will be determined by the ultimate sale process and terms,” said business rescue practitioner Pierre Berrangé.
Sun International COO Graham Wood said the group is restructuring its hotels “because of a reduction in demand and to align our staffing structures accordingly”.
He added: “Weekend leisure demand in our hotels and resorts has been encouraging, though conferencing and corporate travel demand is still very muted.
“In addition, international travel restrictions and uncertainty in SA’s European and North American source markets will result in a very slow recovery in international leisure traveller demand in 2021.”
Tsogo Sun Hotels CEO Marcel von Aulock said Cape Town and Sandton are not expected to recover until well into 2021.