Central Plaza Hotel (Centel) has allocated capital expenditure of 13-20 billion baht for the next three years, in a bid to double the revenue of its food and hotel business by 2029.
Thirayuth Chirathivat, chief executive of Centara Hotels and Resorts (CHR), a subsidiary of Centel, said that for this year the company is reporting a strong hotel performance in Thailand and abroad, including Bangkok, Pattaya, Phuket, Samui, Krabi, Dubai and Osaka.
Revenue from hotel bookings in the first quarter is expected to grow 15% from the corresponding period of 2023.
Last year, CHR recorded 10.9 billion baht in revenue from hotel operations, including joint venture projects, such as in Dubai with over 770 million baht profit, improving from a loss in 2022 which prompted it to target 12.5 billion baht in revenue this year.
Mr Thirayuth said the post-pandemic trend saw a steady growth of independent tourists with high spending, so the company is focusing more on driving up room rates than occupancy rates.
Its room rate across the portfolio is expected to reach 5,500-6,000 baht this year on an occupancy rate of 70-73%, which is higher than the average of 5,100 baht in 2023.
Thailand should see at least 10% revenue growth, while Osaka will be driven by domestic tourists. The Maldives is expected to see consistent flows of Chinese tourists.
For its three-year plan, about 5.6 billion baht will be dedicated to the hotel business in 2024, Mr Thirayuth said.
Around 3.2 billion baht will be used for developing two new hotels in the Maldives, 1 billion baht for renovating the Centara Grand Mirage Beach Resort Pattaya, and 600 million baht to revamp the Centara Karon Resort.
Another 700 million baht will be used for annual hotel renovation, while the rest is for land rental payments for Centara Grand Beach Resort & Villas Hua Hin.
About 2.8 billion baht and 2.2 billion baht capital expenditure will be allotted to hotel renovation and development in 2025 and 2026, respectively.
Meanwhile, the food business will have an investment budget of 1-1.2 billion baht per year between 2024-2026, according to Gun Srisompong, chief financial officer of Centel.
Mr Gun said that with a capital expenditure of up to 20 billion baht, the company is also considering a fifth hotel in the Maldives and another hotel next to its existing Centara Mirage Beach Resort Dubai.
This year, CHR will open six hotels, comprising three in Thailand, two in Laos and a third hotel in the Maldives named Centara Mirage Lagoon Maldives, featuring 145 rooms.
By the end of 2023, CHR had 51 hotels with 11,166 rooms in its portfolio, with 44 hotels with 9,861 rooms in the development pipeline.
Mr Gun said the group aimed to sign 10-15 management contracts this year.