Hotels still counting losses a year after Covid-19 broke out

A restaurant made of Makuti at Jacyjoka Apartments in Mombasa.

Veteran hotelier and investor Janet Chamia was filled with dread when news broke last year that a highly infectious and deadly virus was spreading fast globally.

Soon enough, she became a victim of the Covid-19 pandemic as governments around the world put in place measures such as lockdowns to stop the spread of the virus.

Ms Chamia, the proprietor of Jacyjoka Holiday Apartments in the upmarket Nyali area, Mombasa County, says she lost foreign business after guests from overseas had to be evacuated back to their homes.

“We have consistent marketing campaigns in the Netherlands and the rest of Europe. By the time the lockdown was put in place in early 2020, we were enjoying excellent occupancy,” she tells Weekend Business.

“I kept my staff for two months with full pay despite having zero occupancy and when things didn’t improve, I had to reluctantly ask them to take unpaid leave. The only thing I did for them was to continue remitting their National Hospital Insurance Fund and National Social Security Fund contributions,” she says.

Out of 15 permanent staff, Chamia was left with two to run her boutique hotel.

“Things are steadying up after the lifting of the lockdown and the introduction of health protocols that we are observing. Local guests are streaming back with many international arrivals being noted here,” she says.

Chamia is also the Mombasa County chairperson for Kenya Association for Women in Tourism.

Apart from the hotel business she also owns a tour company, which is still experiencing huge challenges from the effects of the Covid-19 pandemic.

Some distance away in Malindi, Kilifi County, Maureen Awuor, the General Manager of Ocean Beach Hotel also recounts the disruption brought by the virus.

She recalls that immediately restrictions to contain the virus were announced by President Uhuru Kenyatta in March 2020, she had to put most of her staff on unpaid leave. The lucky few who were retained had to contend with half pay.

In a phone interview, Ms Awuor says it was not only her staff that got a rude shock but also the whole chain such as farmers, and several suppliers who depend on the hotel to make money. 

The situation is not much better at the moment compared to 2019 and 2018 as international tourists, known for paying top dollar, have not started flowing back yet.

Domestic tourists are not spending as much as before since many were also impacted economically by the pandemic.

The problem is made worse by the 10pm-4am curfew that has affected bar and restaurant business at the hotel.

“We have not been able to offer game safaris as was the norm before Covid-19 struck. All our vehicles are grounded at the parking yard,” Awuor says.

“We are, however, banking on positive trends like the availability of Covid-19 vaccines which will give travellers the confidence to travel to our destination.

“We are slowly getting back to our feet but the recovery is not yet to expectation,” she adds.

The other worry for the sector is the increase in operation costs. To abide by health restrictions, hospitality facilities have to incur costs such as fumigation, buying thermometers and face masks, which is affecting the already dwindling earnings.

A survey conducted by Central Bank of Kenya between January 12 and 15 this year showed continued recovery of the hospitality industry from the severe disruptions due to Covid containment measures.

It showed 97 per cent of hotels sampled across the country were operating in December 2020 and January 2021 compared to 96 per cent in November, mainly reflecting the continued easing of restrictions and increased compliance with the health protocols.

Employment in the sector continued to recover towards the pre-Covid (February 2020) levels, averaging 60 per cent in December 2020 and 57 per cent in January 2021 compared to 53 per cent in November and 37 per cent in May.

Local guests continue to support accommodation and restaurant services in the sector.

On average, under the existing conditions, about 50 per cent of hotels expect to attain normal levels of operations by end of this year.