Erawan plans to sell 5 hotels, add 7 by 2015

Construction News

The Erawan Group has outlined a fiveyear investment plan to take on seven new hotels and to sell five existing properties.

The group expects to spend Bt7 billion to Bt10 billion on new investment in its hotel business between now and 2015.

The number of hotels will rise from 13 this year to 15 within the next five years. It plans to sell one existing property per year during the course of the fiveyear plan, while adding seven more, said Kamonwan Wipulakorn, the group’s executive vice president and chief financial officer.

She added that the group would open three hotels next year in Bangkok and Hua Hin, worth Bt1.1 billion.

It is also considering adding more hotels in Pattaya, Sri Racha and Phuket to cash in on the bright future of tourism.

In Hua Hin, it will open an Ibis hotel in the first quarter of next year with 200 rooms. The hotel is under construction at a cost of Bt300 million, and will target budget tourists mainly from overseas.

In the capital, it will open a Mercure and an Ibis in the same location, Siam Square. The two properties are scheduled to open in the fourth quarter of next year.

The project is a 30year leasehold with a total of 380 rooms and its cost is Bt800 million.

“Opening two hotels in the same building will help the group grab both markets, Bt1,0001,200 per night for Ibis and a higher rate of more than Bt2,000 for Mercure. Still, rates will be lower than those of all our competitors in the area,” Kamonwan said.

The group operates seven Ibis hotels throughout the kingdom.

It hopes revenue from its Ibis hotels will grow from 38 per cent in 2010 to 50 per cent this year.

Kamonwan said Pattaya, for instance, had high potential from both tourists and foreign communities, particularly Japanese, who are likely to move into the Eastern Seaboard after the crisis in their own country.

The Erawan Group posted Bt78 million in net profit in the first quarter this year, up 34 per cent over the same quarter last year.


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