Why hotel industry faces bumpy ride to recovery

Thursday December 03 2020
Hotel pic

Arusha. Conversion of the iconic Ngurdoto Mountain Lodge in Arusha into a student hostel depicts the sad state of affairs facing the once thriving hotel industry now on a its knees.
View are divided about the fate of some of the nostalgic tourism hotels and lodges that have suffered loss of business over recent years and compounded further in 2020 by the Covid-19 pandemic.  
The Ngurdoto case has also once again exposed the fragility of the hotel industry which is yet to recover from the dire effects of a drastic cut in government business meetings and a general slump in tourism activities, including major conferencing which was one of Ngurdoto’s best selling point.    
Industry stakeholders argued for deliberate interventions by the government  to rescue the iconic hotel properties under siege.
“The decision to turn the lodge into a hostel may have been taken in haste. The family could have consulted widely,” said Ergado Welelo, a tourism stakeholder.  
It was announced on Tuesday that the 300-room lodge near Arusha will be rented  to the Institute of Accountancy Arusha (IAA) as a students’ hostel. The facility was one of the hotel properties in Arusha and Moshi owned by Meleo Mrema, the late business tycoon who died in 2017. His other major hotels, the Naura Springs is also closed while Impala is tattering on the brink of closure.  
An Arusha-based consultant Elisha Mayallah said the luxury lodge was one of the icons of tourism in the northern circuit. “Renting it to students dents the corporate image of the industry,” he told The Citizen on the phone.

crest pic

Snow Crest Hotel, also in Arusha and which has also been shut down. PHOTOS | FILE

Mayallah said there could be other tourism accommodation facilities in Arusha that need to be rescued before closing down completely. He said despite halting business, Ngurdoto located at Usa River near Arusha National Park was still attractive to new investors.
However, he said crises facing many local hotels were partly because its owners do not partner with the global brands for stability. “Franchise is good because it can act as a safety valve in case of unanticipated business decline as is the case with Ngurdoto.
“But our local investors do not seem to realize this despite their huge investments in hotel properties,” he said.
Out of the dozens of tourist class hotels in and around Arusha, only three have partnered with the international brands.  They are Four Points by Sheraton, a 130 year old facility near the Clock Tower, one year old Gran Melia and Arusha Serena Hotel and Resort at Tengeru. Some people have also argued investors did not diversify their products to cushion them from sudden and unforeseen shakes.
An Arusha hotelier Walter Maeda partly defended the renting of the outfit to IAA as a students’ hostel. “The hotel situation is Arusha is very, very bad due to scarcity of guests. By renting it, they will make some income. It’s better, that way,” he said. Mr Maeda is the chairperson of the regional chapter of the Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA).
He echoed calls by other stakeholders that in such crises, the government could offer a hand through reduced taxes. 

Impala pic

Impala Hotel in Arusha. It was among the earliest accommodation facilities for tourists and played a big role in the opening up of the northern tourism circuit, but is currently tottering on the brink of closure due to loss of business. PHOTOS | FILE

According to him, the fate of hotels may come up for discussion during a meeting of the chamber to be held tomorrow (Friday).
One of the pioneers of the Ngurdoto facility, Mr Moses Onunga, said he was saddened by the action taken by the Mrema family,describing it as “a drawback to the industry.”
“I see Ngurdoto as a pride of a nation you can’t easily get. It is a drawback to the industry,”  he told The Citizen on phone from Dodoma. Onunga served as an operations manager for the Arusha-based Impala Group of Hotels for years prior to 2010.
During his tenure the Ngurdoto Mountain Lodge was opened up for business as was the towering Naura Springs Hotel, also under the group.
IAA Rector Prof Eliamanai Sedoyeka said on Tuesday that the lodge property would initially provide accommodation for 1,000 students.
Each student will pay Sh400,000 a year, raking a total of Sh400 million. The number of students can double to 2,000. He said the institute enrolled a record 8000 students this year who were facing a huge problem getting accommodation as the college was yet to get government funding to build its hostels.
It could not be established if the lodge, laid on evergreen and expansive lawns will finally be turned into another college campus.
The development comes as some hotels and  lodges in Arusha appear far from full recovery from the effects of Covid-19.

Naura pic

The towering Naura Springs Hotel in Arusha is a landmark building in Arusha owned by the late tycoon hotel investor, Meleo Mrema. The facility is currently not operating. PHOTO |FILE

Among the hotels which remain closed is Snow Crest along the Moshi highway. Its closure is attributed to an ownership dispute.
The leading hotels downtown have had low occupancy rates for months due to the  declining number of visitors after Covid-19.
Topping the list of tourist hotels in Arusha are Mt. Meru, Kibo Palace, Four Points by Sheraton, Gran Melia, Palace and  African Tulip.
Due to the declining number of guests, other hotels are reported to have converted some of their sleeping rooms into event rooms.
Conversion of hotels into student hostels is not entirely new in Tanzania though they targeted middle class outfits.
The hotel empire under the late Mrema also includes Moshi Hotel (formerly Livingstone) in the heart of Moshi.
It was acquired by the tycoon from the government following a sale but its massive rehabilitation is yet to be completed.



By Zephania [email protected] [email protected]