Grande Asset aims to acquire 6 more hotels

Construction News
The Westin Grande Sukhumvit Hotel, a five-star hotel in central Bangkok, is one of four hotels owned by Grand Asset Hotels & Property.
The Westin Grande Sukhumvit Hotel, a five-star hotel in central Bangkok, is one of four hotels owned by Grand Asset Hotels & Property.


SET-listed Grande Asset Hotels & Property (GRAND) has set its sights on owning 10 hotels by 2020 in a bid to sustain its revenue growth after a bumpy ride over the past five years.

Newly-appointed chief executive Paisit Kaenchan said the company’s new mission was to balance revenue between its property and hotel businesses and generate sustainable income.

Grande has reported relatively volatile operating results over the past five years, with a net loss of 120 million baht in 2015 against a net profit of 602 million baht in 2014, a net loss of 155 million baht in 2013, a net loss of 416 million baht in 2012 and a net profit of 407 million baht in 2011.

Revenue last year totalled 1.38 billion baht, a significant drop from 4.92 billion baht in 2014, though marginally higher than 1.3 billion baht in 2013, 993 million baht in 2012 and 889 million baht in 2011.

Today, Grande owns four hotels: The Westin Grande Sukhumvit Bangkok, Sheraton Hua Hin Pranburi Villas, Sheraton Hun Hin Resort & Spa and Hyatt Regency Bangkok Sukhumvit. It also has three property development projects in the works: Hyde Sukhumvit Condominium Bangkok, Hua Hin Blue Lagoon Phetchaburi and the Trendy Condominium.

In 2015, revenue from its hotel business totalled 1.03 billion baht, with property development bringing in only 286 million baht.

The company has this year invested 2.1 billion baht to build Hyatt Regency Bangkok Sukhumvit. Under construction, it is scheduled to open by the end of 2017.

Recently, the company’s board of directors approved a budget of 600 million baht to buy a 100-rai land plot in Rayong. The land will be used to build its biggest mixed-use project featuring a condominium, villas for sale and a five-star hotel, targeting foreign leisure and business travellers.

The 200-key facility will be the company’s fifth hotel and second five-star hotel in Rayong.

The investment budget for the mixed-use project, however, is yet to be finalised.

The company believes Rayong will be a new tourist destination in eastern Thailand for those looking to get away from Pattaya, which Mr Paisit said had become overcrowded with Chinese and Russian travellers.

Grande plans to develop the new hotel in Rayong as a wedding destination for foreign couples in the same vein as its Sheraton Hun Hin Resort & Spa.

More than 30 couples from India organise their wedding ceremonies at Sheraton Hun Hin Resort & Spa every year, spending on average 2 million baht each.

Mr Paisit said investment costs in Rayong were also relatively lower than in other resort destinations such as Phuket. The opening of U-tapao airport will prove beneficial to Rayong’s tourism, he said.

Looking ahead, Mr Paisit said the company preferred taking over unbranded medium-sized and economy class hotels to achieve its target of 10 hotels by 2020. The hotels will undergo a facelift upon purchase and be upgraded to be four- or five-star ratings.

Grande also plans to set up a real estate investment trust  (REIT) in 2017, starting with Sheraton Hun Hin Resorts & Spa. Proceeds available from REIT will be spent on a mixed-use project in Rayong and taking over unbranded hotels in resort destinations.

All of Grande’s hotels must be run by international hotel management companies, as their brands will add more value to its REIT, he said.

GRAND shares closed on the SET yesterday at 83 satang, up two satang, in trade worth 1.38 million baht.