GREG LOWE in Bangkok
[BANGKOK] International hotelier Golden Tulip Hospitality Group has chosen Thailand as the centre of its one billion euro (S$2.11 billion) South-east Asian expansion plan under which it will open up to 50 properties over four years.
The Swiss-based company, which now operates 324 hotels in 54 countries including China and India, opened its Golden Tulip South-east Asia office in Bangkok last October.
Regional operations are based in the city due to its strategic location, and because more than 20 properties will be opened in Thailand.
“We have over a billion euros committed to this expansion in the next four to five years,” said Golden Tulip chief executive officer and president Hans Kennedie. “We plan to create around 5,000 jobs in the region in that time.”
The first properties will be in Thailand, Cambodia, Vietnam, Indonesia and Malaysia, before others are opened elsewhere in the region, he said.
The economy-business Tulip Inn brand will spearhead the growth plan by targeting Asian travellers in the region’s key urban centres, and will represent 60 per cent of the company’s South-east Asian portfolio.
Room rates will range between US$105 and US$130.
The company has taken this initiative because of “saturation” at the luxury end of the region’s hospitality market, said Golden Tulip’s South-east Asia managing director Mark van Ogtrop.
“We want to enter the economy business segment because that is not saturated yet,” he said. “There is not much competition, plus there are much healthier returns on investment with this model.
“Our unique selling point will be a heavy emphasis on high technology. All rooms will feature Wi-fi, personalised music access, VOIP and more.”
The four-star Golden Tulip and the five-star Royal Tulip brands will also be launched, accounting for 35 and 5 per cent of the portfolio respectively.
The company will partner local developers in each territory to accelerate growth.
“We are a marketing and management company,” said Mr van Ogtrop. “We see that the fastest and best way to grow is to leave the development to local experts.”
The first Tulip Inn is scheduled to open in Bangkok this July, followed by other properties in the city, as well as in Phuket and Koh Samui, plus another in Phnom Penh, Cambodia.
The company plans to open hotels in Singapore, but high land prices and short-term leases are creating a temporary barrier to investment.
“You can’t just walk into Singapore and do a deal,” said Mr van Ogtrop. “Real estate is typically expensive there. You are also often dealing with very short government leases. If you want to invest in a hotel, you can’t use a short-term lease model.
“The opportunity is in finding a property to acquire, then you don’t have those barriers,” he said, adding that the group is in talks and hopes to make an announcement soon.
The company also plans to lure investors by launching a Golden Tulip South-East Asia Capital property investment fund later this year.
(C) Singapore Press Holdings Limited