IPOH, April 30 — One of the most well-known hotels here, Syuen, will shutter its operations on May 31 after failing to secure the funding needed to continue under the adverse business conditions caused by the movement control order (MCO).

The hotel’s board issued a notice to all employees informing them that they were being retrenched as a result.

Among the oldest hotels in Ipoh, Syuen is the latest to fold under financial pressure as occupancy dried up after authorities enforced the MCO to try and contain the spread of the coronavirus disease (Covid-19) in the country.

In the notice leaked online and which an employee confirmed receiving, director Loh Sow Chee told employees that the company had already been suffering substantial losses for the past three years.

Loh said this was worsened as the hotel could not effectively operate under the MCO, adding that the outlook for the sector was bleak in the immediate future.

"Even though, after the MCO is lifted, it would be highly unlikely that the tourism industry will recover in the very near future.  

"A sharp decline in demand of hotel accommodation and our other facilities is inevitable, causing the dropped sales turnover to low, where we would not afford to stretch our financial capabilities any further to sustain our operation.

"It is with much regret that the management has to take this decision with a heavy heart, as a last resort,” Loh said

The letter also served notice of termination to the employees, but assured them they would receive their May salaries along with other payments due to them.

They will also receive the benefits owed to them under the Employment Act’s stipulations for retrenchments and lay-offs.

An employee who asked not to be named confirmed that the staff received the retrenchment notice sighted by Malay Mail.

"Yes, the hotel will be closed permanently on May 31. About 155 staff will be affected due to the closure,” the person said.

Syuen Hotel was officially opened on October 24, 1993. Designed in neo-classical theme, the hotel’s building is reminiscent of the best of old Ipoh architecture.

It is the third confirmed hotel closure in Ipoh since the MCO came into effect on March 18.