Unlock 4: Maharashtra allows hotels and lodges to operate at 100% capacity

Starting tomorrow, hotels and lodges in Maharashtra will be allowed to operate at 100 per cent capacity utilisation rate, as per the guidelines issued by the Maharashtra government on unlock 4.0 on Monday.  The move comes as a big relief for the hotels and all those in the business of offering accommodation in the state that have so far been operating at a third of their capacity.

Even as the hotel association welcomed the move, it said the notification is silent on restaurants and will help if there is further clarity. “Allowing 100 per cent capacity from 30 per cent now is a welcome move. But it’s not clear whether it also includes the restaurants,” said K B Kachru, vice president, Hotel Association of India.  The fact that restaurants are not in the negative list means they too can operate at 100 per cent capacity. But hotels will need clarity on the matter, he added.

 

Food and beverage (F&B) accounts for more than half of revenue for five star hotel chains, therefore the permission to operate at full capacity is critical for hotels. The revenue from the segment has collapsed following the lockdown prompting luxury five star hotel chains to re-invent themselves and diversify into home delivery of food, a concept that was earlier unheard of.

“Hotels and lodges will be allowed to operate at 100 per cent capacity. Separate SOP (standard operating procedures) will be issued for necessary precautions to be taken while operating these establishments,” according to the circular issued on Monday. Some of the other states that have allowed hotels to operate at full capacity include Delhi, Telangana and Karnataka.

The move particularly spells good news for Maharashtra focused hospitality firms like Chalet Hotels, the asset manager of Marriott International.  Most of the assets owned by the K Raheja Group firm are Mumbai based.