Three to five-star hotels in Sabah are witnessing an occupancy loss of 3% to 7% as a result of the increase in popularity with home sharing operators such as Airbnb. This is despite the increase in domestic and international tourists.

According to Gordon Seet, general manager of Ibis Styles Kota Kinabalu and chairman of the Malaysian Association of Hotels Sabah and Labuan chapter, occupancy rate for five-star hotels in the first quarter of 2019 (Q1 2019) dipped from 84.9% to 77.9%. Meanwhile, four-star hotels saw a decline in occupancy rate from 77.7% to 74.4%, while three-star hotels and resorts recorded a drop from 62.3% to 60%.

Seet said that the non-registration of Airbnb and other home-sharing operators is a "huge loss" to the state's tourism industry in terms of revenue generation, as they do not pay tourism tax. As such, Seet said that the registration and legislation of such operators will be a "win-win situation" for the government, local councils and all accommodation providers in Sabah.

"Hotels in Sabah desire a fair and competitive playing field in offering good services to international and local tourists," Seet added.

The state saw a 9% increase in tourists to 1,033,871 during Q1 2019 and Seet said the tourists have spent approximately RM2.23 billion. He added that the tourism industry is among the "biggest revenue earners" for Sabah after palm and crude oil export.