Centara Hotels & Resorts, the country’s leading hotel and resort chain, plans to launch an economy hotel segment to cash in on fast-growing demand from travellers.
The segment will come under the Cosi Hotels brand and become the group’s sixth brand.
The expansion allows the group to have a variety of hotel formats to serve different demands, according to chief executive Thirayuth Chirathivat.
Construction of the first economy hotel will start some time next year on Bangkok’s Ratchadaphisek Road. It is expected to be open in early 2015.
Centara plans to have at least 30 Cosi hotels, each with 150-200 rooms, in major cities at home, in Asean countries and in China, Australia and New Zealand .
It will open hotels in Bangkok and suburbs before expanding.
Five Cosi hotels will be financed by the company at a combined cost of 1.5 billion baht. Investment in the other 25 hotels will be done under contract management. In general, investment per room will be 1.5 million baht.
“Cosi Hotels will differentiate itself from rivals,” said Mr Thirayuth. “We will charge 1,000 to 1,250 baht per room per night without any extra costs.”
The company expects the hotels to have occupancy rates as high at 75%.
Mr Thirayuth said Centara still has room to expand its economy hotel segment in line with the rise of low-cost carriers that are driving regional travel.
Mr Thirayuth said Centara will seek to expand Cosi Hotels because of the brand’s low investment costs and expected stable occupancy rates.
Apart from Cosi Hotels, the company operates the Centara Grand, Centara, Centara Residence & Suites, Centara Boutique Collection and Centara Hotels & Resorts brands. Some 12 new hotels in all formats will be added next year.
The company expects sales revenue under its group will grow next year by 21-22% to more than 17.3 billion baht, up from 14 billion baht this year.
Of the total, 7.7 billion baht will come from hotel business and the remaining 9.6 billion will belong to food business.