Taj Hotels mulls northeast expansion
India’s Taj Hotels’ Group is expanding into northeast Sri Lanka, aiming for three new resorts with a total of around 300 rooms in the first phase of this initiative, officials said.
Rohit Koshla, Director Operations – Taj Hotels and Resorts, Area Director Sri Lanka and General Manager Taj Samudra, said that they are looking at existing properties (in the northeast) or in a state of construction where the company can provide inputs into design. “We are talking to a lot of people but it’s premature to say who and what,” he told the Business Times in an interview on Wednesday, adding that the company would be managing and not investing in new properties.
The hotel group which has four main brands – luxury hotels, Vivanta, Gateway and Ginger of which three are present in Sri Lanka, is investing or helping to invest nearly US$50 million over a period of three to four years in its current properties to upgrade, refurbish or build new rooms. The funding from two banks – ICICI Bank and HNB – is through debt financing.
The company, the only international hotel brand to survive since 1983 in a country where development was deterred by a bloody ethnic conflict, has a total of 662 rooms in hotels it owns and manages in Sri Lanka.
“We are open to joint ventures but because there are a lot of hotels that exist in those markets, we are focusing on managing hotels rather than buying properties,” he said, adding that with a massive distribution network they were confident of driving business in the northeast, particularly in areas like Passekudah and Trincomalee. Mr. Khosla said November’s Commonwealth Summit is a blessing for the country as it provides heads of state or government and their delegations an opportunity to see the ‘new’ Sri Lanka and how it is rebounding.
“We have been here for over 30 years and we are totally committed to the country and the destination. It is the only international brand that has been here for so long. We have been through thick and thin,” he added.
Investments in the hotels are as follows: 300-room Taj Samudra (owned by the group) $20 million in two phases, one of which ends in November; $12 million spent at the 162-room Vivanta by Taj at Bentota which is 50 per cent owned by the Taj Group and the balance by the Hirdaramani family; and $3 million spent at the Gateway Hotel (formerly Airport Garden) owned by the Hirdaramani/Advani families and managed by Taj.
Another $12 million is being spent at Gateway in a new wing which will add 100 more rooms to the existing 100 rooms. Both the Taj, sections of which are closed now, and Gateway will be ready for full occupation after November 1 to accommodate delegates attending the Commonwealth meeting.
Mr. Khosla said that between Taj Samudra and Vivanta, the group spent over $30 million which ‘could easily have bought three hotels but we chose to invest in upgrading existing hotels and bring them up to international levels.”He said they were upbeat about tourism and arrival figures were very encouraging.
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