The InterContinental Hotels Group (IHG) is mulling permanent closure of its Nairobi branch over adverse effects of the coronavirus pandemic on its operations.
The management closed InterContinental Hotel Nairobi in early April after the government announced stringent measures to curb the spread of the virus including the ban on social gatherings and air travel.
Following the closure of the luxurious hotel located at the heart of Kenya’s capital, the management provided each employee with a one-off care payment to help them pull through the financial pressure occasioned by the pandemic.
In a communication to all employees dated August 3, the management stated that it intended to reopen in July but the prevailing circumstances including uncertainty around the pandemic and movement restrictions forced the leadership to suspend the plans.
The extension affected most of its hotels worldwide.
The management now says that with the pandemic affecting its revenue, the option of permanent closure of the hotel is on the table.
“Faced with the most challenging environment our industry has ever seen. we have had to conduct a wide-ranging review to protect our global business for the long-term One aspect of this review includes an assessment of the long-term future of each of our hotels; particularly those which have had to close temporarily in response to the economic conditions caused by the pandemic.
“With regard to the InterContinental Nairobi, we have conducted a thorough review of all options available We are considering the question of whether, and when the Hotel might reopen; or whether we should now surrender the tenancy de-flag and permanently close the Hotel and hand back the property to the landlord, ” the management said.
The group told its employees that it’s assessing the cost of running the hotel amid the pandemic before deciding on its fate.
“We are assessing the cost to IHG of continuing Hotel operations in the prevailing circumstances prior to the outbreak of the Covid-19 pandemic and in the period after recovery, including the added cost of ramping up the business after reopening whilst ensuring compliance with the strict health and safety requirements of the post-pandemic environment, ” the letter reads.
The hotel is majorly owned by former President Daniel Arap Moi’s aide Joshua Kulei and members of the Moi family.