COVID 2.zero season: Accommodations head to small cities, step into healthcare area

Mountain stations and beach resorts, which have always been a tourist attraction, have gained in importance since the second wave of COVID.

Last month Mahindra Holidays announced that it would cease operations in Finland. Earlier this month, Hyatt Regency announced it was closing its Mumbai property. Obviously, the second wave of COVID has severely affected the hospitality industry’s prospects. Just as they began to recover from the first wave of the pandemic and occupancy increased, hotels and resorts were forced to deal with a more deadly second wave.

Real estate consultancy JLL (Jones Lang LaSalle) said in a report that hotel occupancy in the country fell 17% from the previous month in April 2021, despite room rates down 9%. While the second wave of COVID seems to have flattened out now, there is lingering fear of an impending third wave that leaves people without making elaborate travel plans.

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JLL said in its Hotel Momentum India (HMI) report that the Indian hospitality industry saw a 38.7% drop in revenue per available room (RevPAR) in the January-March 2021 quarter from the same period last year (just before the pandemic outbreak). RevPAR in the country’s top 6 cities fell 48% over the same period, he added.

The linchpin in healthcare

But the hospitality industry strikes back and is finding innovative ways to stay afloat in difficult times. The most common route chosen today is reuse. Hotels are increasingly offering health services, especially for COVID patients who only need basic care and quarantine but cannot find them at home for various reasons.

Recently, hotel group ITC converted its Welcome Hotel properties into quarantine facilities in select cities such as Delhi, Bengaluru, Chennai and Coimbatore. It is associated with hospitals to provide hygienic and safe facilities for light and asymptomatic patients. Various other hospitality groups like Lemon Tree Hotels have also chosen to partner with hospitals to offer quarantine facilities.

Several other hotels tried to jump on the vaccination train with “attractive” packages. For around 3,000 yen, guests could spend a night in a luxury hotel room, have a free breakfast, and also take the COVID jab. Before this could take hold, however, the government gave in and asked hotels to stop the vaccination campaign.

Small town wonder

With business travel in nadir and major cities being COVID hotspots, the hospitality industry is shifting its focus to tier 2 and tier 3 cities and fancy travel destinations. Hill stations and remote locations are attracting attention, according to a report by Indian Express. For example, the ITC Group’s Welcomhotel has just opened a property in Chail, Himachal Pradesh, they said.

In most states, smaller cities have had fewer curbstones since the COVID attack. In addition, after unlocking, these cities will be among the first to experience a relaxation of norms of movement. For city dwellers tired of lockdown, this is extremely attractive.

Mountain stations and seaside resorts, which have always been a tourist attraction, have gained in importance since the second wave. The open spaces, which promise less transmission of infection, are a clear plus. After the recent unblocking, Delhi residents rushed into the hills in droves, seeing photos of congested highways from the capital to Uttarakhand, Himachal Pradesh, etc.

“The hills and beaches are usually the quickest to recover, and this time we’re seeing great interest in these hotels again,” the Indian Express report quoted Anil Chadha, COO of ITC Hotels, as saying.

Whether the new revenue routes chosen by hotels and resorts are temporary or permanent depends largely on how the pandemic unfolds.