Messengers, receptionists, chefs and concierges: hotel staff at Japan will probably have more time to watch the Olympics than expected.
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The fourth Covid-19’s state of emergency in Tokyo and the decision to hold major athletics events without an audience generated a wave of hotel room cancellations. This new setback puts even more pressure on the hotel industry, which has staked heavily on the Olympic Games as a springboard to Japan’s economic goal of attracting 40 million foreign visitors a year.
While hotel chains with large cash reserves can adjust for the long term and wait for better days after Covid, for smaller operators, the Olympic dream shaken by the pandemic is already testing the commercial resilience of companies amid rising orders of judicial reorganization.
“We had high hopes and expectations for the Olympics,” said Makiko Furusato, who runs a small Japanese ryokan-style hotel a 15-minute drive from four major gaming centers. “We opened in October 2019 and were immediately hit by the pandemic. Now this, just when we expected some money to come in.”
Furusato and her husband previously helped run a hotel in a tourist town west of Tokyo. They saw the games as a unique opportunity to change and open their own boutique inn. They chose the new neighborhood specifically with the Olympics in mind.
But instead of a hotel full of guests during the Games, Furusato faces cancellations and competition from other hotels that have lowered prices to a third of the current rate during the Olympic period.
“Bars and restaurants are also in terrible trouble, but at least they are getting some compensation from the government,” says the owner, expressing frustration that Prime Minister Yoshihide Suga has not taken more steps to help people like her. “The spotlight is simply not focused on our industry.”
The decision to ban spectators at sporting events could lead to the cancellation of more than a million reservations or hotel stay plans. The number is based on 30% of people with tickets for the games coming from outside greater Tokyo, as indicated by Olympic Games Minister Seiko Hashimoto. Each of them planned to stay at least one night in a hotel.
“This latest blow will most likely trigger more bankruptcies,” said economist Hideo Kumano of the Dai-Ichi Life Research Institute. “And you can’t rule out the impact on the national climate by leaving the Olympics without spectators.”
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