Hong Kong developer Chinachem's hotels unit brings in robots to beat coronavirus slump

By Lam Ka-sing kasing.lam@scmp.com

/ https://www.scmp.com/business/article/3078765/hong-kong-developer-chinachems-hotels-unit-brings-robots-beat-coronavirus?utm_medium=partner&utm_campaign=contentexchange&utm_source=EdgeProp&utm_content=3078765 |

April 13, 2020 10:05 AM SGT

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Hong Kong hotels operator L'hotel Group has turned to robots amid a Covid-19 driven slump in the hospitality sector, with the aim of providing meals to guests and ensuring reduced interaction with staff.

The company, which is wholly owned by property developer Chinachem Group, will have three artificial intelligence robots called Genie delivering meals and drinks to guests at its 432-room L'hotel Island South property in Wong Chuk Hang, which welcomes guests in quarantine, by mid-April. L'hotel said it was the first hotel to introduce meal-delivery robots in Hong Kong.

A Genie robot is already serving 130 to 150 meals a day, mostly to those quarantined. "With the rapid development of information technology, L'Hotel Group is convinced that the introduction of robots in the hotel industry, to implement automated services, will be a megatrend in the next five years," the company said.

The introduction of these robots comes at a time when hotels in Hong Kong are reeling from the effects of the coronavirus pandemic, which has followed on the heels of months of anti-government protests. In the midst of this, tourist arrivals have all but disappeared, events have been cancelled and occupancy rates have plummeted. This has, in turn, forced hotels to cut some staff, force others to take unpaid leave and even suspend operations.

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A spokeswoman for L'hotel said that none of its staff had been asked to take unpaid leave. The hotel, however, declined to reveal the number of staff and its occupancy rate.

The cost of each robot, acquired on a subscription basis from Hong Kong-based Rice Robotics, runs into six figures every month, said Victor Lee, the robotics company's founder and chief executive. The hotels "want to minimise person-to-person contact" amid the pandemic, Lee said. "Comparing the situations before and after the epidemic, the growth [in sales] stands at three to four times."

"Hotels overseas are already using robots to deliver services and items ... for two to three years now," said Ada Choi, head of occupier research in Asia-Pacific and head of research in Greater China at CBRE. "[The pandemic] is likely to see the adoption rate pick up. I can see this becoming more practical. Robotic technology is advancing as well to become more intelligent," she added.

This week, Hotel Benito in Tsim Sha Tsui said it would suspend operations on June 1 for redevelopment after its income had nosedived by more than 80 per cent. Last week, InterContinental Hong Kong hotel, also in Tsim Sha Tsui, opted to start a lengthy renovations process earlier than scheduled and let go of about 500 staff members, according to a workers' union.

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"With Hong Kong's tourism essentially down to zero, the shareholders decided to try to accelerate the renovations, so we can reopen sooner," said Goodwin Gaw, chairman of Gaw Capital Partners, which led a consortium that bought the InterContinental in 2015.

Hotel occupancy averaged just 15 per cent to 18 per cent in late February, according to a survey of staff in about 170 hotels across the price spectrum carried out by the Hong Kong Hotel Employees Union.

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According to the poll, which was released early last month, four out of five hotels had seen their business drop by more than 70 per cent year on year, as travellers were deterred from visiting Hong Kong by a number of factors.

About six in 10 respondents believed the slump would persist for four to six months, while the rest thought the sector would take seven months or more to emerge from it.

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This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved.

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