CP Land assigns B2.2bn for hotels

CP Land assigns B2.2bn for hotels

Fortune Rajpruek Hotel, a 10-storey building with 159 rooms, is in Nakhon Ratchasima province.
Fortune Rajpruek Hotel, a 10-storey building with 159 rooms, is in Nakhon Ratchasima province.

CP Land Plc, the property arm of Charoen Pokphand Group, plans to launch nine new hotels in the provinces in 2017-18 with an investment of 2.2 billion baht and five condo projects worth combined 2 billion baht next year.

Naravadee Waravanitcha, executive vice-president for investment and hotel management, said the company would expand the hotel business according to consumer demand.

One of the new hotels will start operations next year, Fortune Rajpruek Hotel has 159 rooms in Muang district of Nakhon Ratchasima.

The hotel was a non-performing asset acquired through bidding from Sukhumvit Asset Management Co this year, and has cost CP Land a total 400 million baht, including renovation costs.

"Throughout the next three years, we will invest in 10 new hotels per year, spending 120 million baht per hotel," she said. "Our focus will be in the budget hotel segment, to serve consumer demand."

There are two budget hotel brands for segment including Fortune D and Fortune D Plus. with room rates of 790 baht and 1,200 baht per night.

Besides Fortune Rajpruek Hotel, three other hotels will start operating next year in Khao Yai and Muang districts of Rayong and Loei with 79 rooms each.

Five hotels with a total of 717 rooms will open in 2018, the largest one with 322 rooms in Nakhon Si Thammarat and 79 rooms each in Rayong, Buriram and two other provinces.

CP Land has five hotels with a total of 872 rooms, one each in Bangkok, Chiang Khong district of Chiang Rai and Mae Sot district of Tak, and two in Nakhon Phanom.

The average occupancy rate in provincial hotels dropped to 57% in October due to the mourning period but is expected to pick up to 60% as usual for the final two months of the year.

The Bangkok hotel had an occupancy of 77%.

The hotel business is one of CP Land's recurring income properties, which has generated one-third of the company's income.

Two-thirds will be from residential development.

This year CP Land launched four new condo projects in four provinces including Lampang, Buri Ram, Nakhon Ratchasima and Prachin Buri with 200 units, each recording sales of 80% in Lampang and 50-60% in the rest.

"We are also looking to invest in serviced apartments in neighbouring countries including Myanmar, Vietnam and Indonesia but we are waiting for more clarity within regulations," said Ms Naravadee.

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