Makati Shangri-La, Manila will temporarily close beginning Feb. 1, 2021 as part of the reorganization of its operations in the Philippines, the Shangri-La Group yesterday said in a statement.
The iconic hotel at the corner of Makati and Ayala avenues which started operations in 1993 becomes the latest five-star hotel to succumb to the slump of the travel and tourism industry due to the new coronavirus disease 2019. Marco Polo Davao, the only five-star hotel in Mindanao, closed its doors last June.
A company spokesman said all other Shangri-la hotels in the Philippines — Edsa Shangri-la in Ortigas Center; Shangri-la Mactan Resort and Spa in Cebu, Shangri-la Boracay Resort and Spa and Shangri-la at the Fort – will remain operational.
The statement said it will let go of some of its employees but did not specify how many will be affected.
The company assured workers will receive a fair compensation package that is higher than local statutory guidelines. It is also extending healthcare coverage and grocery support to these employees until the end of the year.
“Despite our best efforts, the prolonged recovery timeline has resulted in increasing financial pressure on the company here in the Philippines. Owing to continued low business levels and having considered all viable options over weeks of consideration and deliberation, we unfortunately must now make the extremely difficult decision to reorganize our workforce and operations in the Philippines as we continue to navigate an uncertain business environment,” the statement said.
The Shangri-la Group said it took steps to mitigate the financial impact brought about by the pandemic, including salary reductions at management level, shorter work weeks, freeze hiring and cuts in non-essential spending.
The hotel was one of 15 hotels allowed to accept staycations and continued to operate its restaurants when the restrictions were eased. However, business remained low.
The company said it has provided assistance to its rank-and-file employees the past 10 months.
“We continue to vigilantly monitor local and global developments and look forward to reopening Makati Shangri-La, Manila at a later date when business conditions have improved,” the company said.
The Shangri-La chain of hotels is part of the Shangri-la Group founded by Malaysian tycoon Robert Kuok and which has been operating in the Philippines for the past 30 years. The Kuok Group also has property development projects in the country.
The Department of Tourism (DOT) said in a statement is saddened by the news of Makati Shangri-la’s temporary closure, adding the “hotel has been a pillar in the tourism industry in the Philippines, and has contributed to positioning the country in the region and around the globe.”
“We are hopeful that Makati Shangri-la Hotel will soon reopen its doors to international and domestic clients,” the DOT said.
The DOT added it will continue to spearhead the acceleration of the recovery of the country’s tourism industry and continue to assist its tourism stakeholders.