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SINGAPORE: With tourist arrivals still in the doldrums, hipster hostels in Singapore have turned their attention to an entirely new clientele: the thousands of Malaysian workers in the country, who are unable to commute through the Causeway due to travel restrictions. travel.
“It’s the only thing keeping us afloat, aside from salary support and rent waivers,” said Jacquelyn Chan, director of The Hip and Happening Group, which owns the Rucksack Inn.
“Of the guests we have now, 95 percent are Malaysians,” he said, adding that the 160-bed backpacker hostel can only operate at half capacity due to safe distance measures.
The hostels CNA spoke to said they had to change tactics quickly once the borders were closed and it was clear that this group’s network would be their lifeline in the absence of leisure travelers.
For Charles Lumanlan, the owner of Hipstercity Hostel, that meant shifting the markets from millennial travelers willing to shell out more for private rooms, to workers who need cheap bed space.
The interior of a room at Hipstercity Hostel along Circular Road in Singapore. (Photo: Hipstercity Hostel)
“The normal price is 50 dollars a night, but now we charge 25 dollars… My competition is not just other hostels, they are everyone else (in Singapore, those who have a room to spare). I have to compete with those prices, ”the boutique hostel operator told CNA.
“DON’T TALK ABOUT BENEFITS”: OPERATOR
This has kept the beds full, as far as restrictions allow, but it is not enough.
“Even though the demand reaches 50 percent of the allowed operating capacity, the prices are not there, so we sacrifice in terms of revenue. I need to have an occupancy of 80 or 90 percent to break even at this price.” said Joyce Kay, Chief Executive Officer of K2 Guest House.
“We are surviving … but let’s not talk about profit, there is no profit. It’s like we’re doing charity work, ”said Kay, who has 270 beds in two branches.
On top of that, establishments must deal with the added costs of more frequent cleaning and a 24-hour front desk to handle crowd control.
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They also can’t cash in on the craziness of home vacations, because only guests with valid reasons can book a stay.
According to the Singapore Tourism Board, these reasons include having a home environment that is “not available or accessible” due to renovation works, for example.
Other valid reasons involve “working or domestic conditions,” such as domestic disputes at home or wanting to stay closer to the workplace to reduce travel time.
It’s a big tweak for Lumanlan, who said that every month he receives at least 20 home vacation booking requests, all of which he must decline.
MIXED FEELINGS ABOUT THE REOPENING OF THE BORDERS
While prolonged border closures have hurt the hostel business, operators have mixed feelings about the possibility of travel resuming.
“If the borders are opened, Malaysians will return, but not enough people will return quickly enough … Shelters will be razed,” warned Ms Chan.
They would also be the last to fill up, he said, as they have shared facilities that many people would avoid in the midst of a pandemic.
The staff at Rucksack Inn, a backpacker hostel along Lavender Street in Singapore. (Photo: Backpack Inn)
“And people who would travel at this point, for example, there are a lot of costs involved with COVID testing, they are not our target audience,” he told CNA.
Lumanlan, however, believes there will be an immediate demand for affordable accommodation in the short term.
“If your flight is that expensive, you’ll want to save on your stay,” he said.
He cited how when Singapore began to open its borders, his 16-bed hostel quickly began receiving bookings from businessmen from Vietnam.
“So we are trying to hold out as long as we can until that time comes. I know for sure that when a vaccine comes out or if travel bubbles increase, business will definitely come in. “
FIND OTHER WAYS TO SURVIVE
The Singapore Backpackers Hostel Alliance was formed in April and according to founding member Ms Chan they have had about five meetings with the authorities so far.
She said the overall message has been: “pivot, prepare to shut down or hang on.”
The shelters agreed that government support, such as wage compensation and rent refunds, has been helpful, but the concern is how long they will be able to survive after the aid comes to an end.
Meanwhile, they are trying to find other ways to shore up the business.
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The interior of K2 Guesthouse Central, a capsule hostel on Jalan Besar in Singapore. (Photo: K2 Guesthouse)
K2 Guest House is renovating the food and beverage point of sale within its premises to become an independent store, which would allow it to open for business and increase revenue.
It is also expanding its network.
“We may have to rent to local Singaporeans who cannot work at home, whose houses are too small, who are crammed into a noisy shared room and need a break,” said Ms Kay, while reiterating that the regulations must be adhered to.
For the Rucksack Inn, Ms. Chan said they are hatching plans to implement crowd management technology, which would help reduce labor costs.
“We are also considering using more energy saving measures. We are already thinking about post-COVID, so there will be efficiency when travelers return, “he added.
TAKE IT ONE DAY AT A TIME
The shelters told CNA they are preparing for a difficult road to recovery, but there is reason to be optimistic.
With commuters arriving, Lumanlan said: “I don’t expect the industry to pick up again next year, but at least I hope it will be better than this year.”
“With Phase 3 starting hopefully soon, if authorities can reduce safe distancing measures for shelters so we can increase capacity, then I think we have a chance to survive,” Kay told CNA.
Ms. Chan also said: “We see light at the end of the tunnel with the news that a vaccine will come out soon… We believe that in the long term, tourism will return. I just hope we’re there to see it. “
