We're not entirely sure where this hotel is, but they certainly don't want guests to lose their room keys! Perhaps this hotel is in a remote location where guests are out doing activities all day, or maybe the hotel's location makes getting hold of spare keys difficult. Either way, there's not much chance of this enormous key getting lost. Hopefully, the staff at reception are happy with guests leaving their keys with them while they're out and about.
It would be kind of ironic — and pretty funny — if the actual room key came off the chord, leaving just the enormous wooden version for the guest to deal with.