Upclose with Tan Sri Teo Chiang Hong
President of Malaysian Association of Hotel Owners (MAHO)
Tan Sri Teo Chiang Hong, has been helming MAHO’s presidency since 2016, representing its members in safeguarding their return on investments and promoting the development of the hotel and tourism industries in the country.
Not only is he an owner of two hotels, this 68-year-old mechanical engineer by profession, also has his vast experience spread out to cover real estate development, mortgage financing and logistics.
MAHO celebrated its Silver Jubilee in 2024. What are some of its achievements over the past 25 years?
Established in March 1998, the association started with 13 companies as founding members who own about 45 hotels of three to five-star category.
Our membership has now reached close to 90 companies with an inventory of 195 hotels and more than 40,000 rooms.
With the recognition given by the Ministry of Tourism, Arts and Culture (MOTAC) as well as the Malaysian Investment Development Authority (MIDA), MAHO membership is a requirement when dealing with both of them. Additionally, we have joined their sales and trade missions abroad.
MAHO is an active participant in issues concerning investment, business policies, incentives and taxes among others with the government agencies and relevant authorities such as the Finance Ministry, Human Resources Ministry, Ministry of Investment, Trade and Industry as well as the Department of Statistics.
Besides being invited to their meetings, we are also made a committee member in working groups dealing with these related issues.
We regularly contribute our views and inputs to them on the hotel sector and tourism, and they are well received.
To what extent have hotel businesses recovered to-date from the COVID-19 pandemic?
Given the positive domestic and international tourist arrivals in 2024, the occupancy rate for the hotel sector has improved in tandem to around 60% to 70% post- pandemic, reaching more than 80% during the peak season.
What are the major concerns plaguing hotel owners or investors post-pandemic?
Manpower shortages, generally low hotel room rates and rising operational cost are among the primary issues burdening hotels operators and owners alike.
The cost of resources and services are also much higher now.
With the recent Budget 2025 announcing that monthly minimum wages will be raised from RM1,500 to RM1,700 for employers with five staff or more from February 1, 2025, we expect to see consumer prices surging further for goods and services.
Compounded by the increase in the Imbalance Cost Pass-Through for electricity tariffs from RM0.02/kWh to RM0.16/kWh in July 2025, this will put further pressure on the operational cost for business owners.
Despite all these increases, hotel room rates in Malaysia have remained relatively low, especially when they are pitted against the US dollar and other major foreign currencies.
What is the status on MAHO’s plans to establish its Chapters in other states of Malaysia apart from those in the Klang Valley?
It is our association’s wish to have state Chapters but the Registrar of Societies’ regulations require us to have at least seven members in a state for a Chapter to be established. Currently, we do not have enough members in a state to form one.
Hence, MAHO is now making efforts to get more hotel owners, especially those outside the Klang Valley to be members.
Roadshows and membership drives will be undertaken to encourage more hotel owners and operators to join MAHO.
Hotels are said to be your passion, with you owning two of them in the Klang Valley. What is the difference between them?
The hotels under two different companies: M Resort and Hotel Kuala Lumpur under M Resort Hotel Sdn Bhd and M World Hotel, formerly Avante Hotel, which is owned by Bandar Utama City Assets Sdn Bhd.
Both hotels are five-star category but M Resort and Hotel is more exclusive and luxurious being a city resort with convention facilities.
How do you ensure their long-term profitability and competitiveness?
In hospitality, service standards and well-maintained facilities are very important. So, keeping a manageable cost of operations without affecting the required service standards is very important.
Maintaining a proper number of manpower and adequate skilled personnel to provide high quality service standards and hospitality are essential.
Additionally, the hotels must have special attractions to draw customers to its hardware as in the property or building and its facilities.
Likewise, the software such as outstanding service by its hospitable and skilled manpower are also crucial.
Most importantly, their room rates should reflect the hotels’ star-rating and service standards.
Are there plans to open more hotels in the near future?
Certainly!
Looking at the 34 million visitor arrivals to Malaysia from January to November 2024, does the country have ample hotels and flights to cater to the growing demand?
There are 5,041 hotels with a total of 132,163 rooms registered under MOTAC as of June 2024. Although hotels have seen an increase in occupancy, there are still many rooms available, especially from non-registered and illegal tourism premises under the short-term rental accommodation (STRA) via booking portals, in particular Airbnb.
With several high-end hotels expected to be opening soon, this will increase the room inventory further and exacerbate the problem.
MAHO and the other hotel associations such as the Malaysian Association of Hotels have been pursuing the STRA issue and persuaded the government to get these premises to be quickly licensed and subject to regulations and enforcements as per the legal hotel operation.
As for flights, they are improving with more frequencies to popular and new routes. Targeted market destinations are also being planned by both the local and foreign airlines.
In principle, we should focus more on high-yield tourist markets which give better tourism receipts that will benefit premium-class tourism facilities or upmarket service providers, including hotels, shopping malls as well as food and beverage outlets.
On the preparations for Visit Malaysia Year 2026 (VMY26), what is MAHO’s engagement with its Secretariat thus far?
MAHO gave our views, inputs and proposals during our engagement with VMY26 Secretariat on targets and promotional activities in September 2024.
With the emphasis on environmental, social and governance (ESG) practices, what are hotel operators and developers doing to be more sustainable?
Hotels have long taken up initiatives and efforts on sustainability even before the term ESG practices was established.
It has been a major consideration for hotels since initiatives such as energy saving, going green and efficient resources consumption will result in long-term cost savings apart from protecting the environment.
Owing to the demand by hotel guests globally, hotels are now reducing and even banning the use of plastic bottles for drinking water besides maintaining room or premise temperatures at optimum level.
How do you unwind? Do you still have time to play golf?
No time for golf these days, but I do find some time for workouts at the gymnasium. Family gatherings are good opportunities for me to unwind, meet up and cherish each other and spend time with the children.