Sri Lanka's Amaya Leisure Spends $100mn on Expansion

10th July 2010, www.lankabusinessonline.com

Amaya Leisure, a firm connected to Sri Lanka's Vallibel group said it would invest 100 million US dollars in the next four years in four new hotels in an aggressive expansion to meet growing demand post-war demand in the island, an official said.

"We intent completing all these projects before 2014," Amaya Leisure managing director Lalin Samarawickrama told a forum in Colombo organized by Acuity, an investment bank.

"If we (Sri Lanka) are to reach 2,500,000 tourists, we need bedrooms. Amaya intends expanding to 1,000 bedrooms by 2014. That is our target."

Last year 447,000 tourist came to Sri Lanka and 600,000 are expected this year. In June 2010 arrivals were up 48 percent following the end of a 30-year war in May 2009.

Group Growth
Amaya leisure started in 1981 as Connaissance, a tour operator, just before a 30-year ethnic war intensified sharply following ethic riots in 1983.

In 1994 it build a chalet type hotel near Kandalama lake in central Sri Lanka. This was rebranded in 2005 as Amaya Lake and has 106 rooms and has been upgraded to 4-star standard.

Samarawickrama said the group pioneered hotel branding in Sri Lanka, and was soon followed by Chaya and Cinnammon brands of John Keells group and Heritance of Aitken Spence.

Amaya Hills in Sri Lanka's hill capital Kandy (formerly known as Le Kandyan) has also recently been refurbished to a 4-star standard with 104 rooms.
In 2003 the group purchased a major stake in Hotel Reefcomber in Hikkaduwa in the southwest beach resort area and is now managing it under the brand Amaya Reef as a 3-star property. It also has a 50-room luxury property called The Fortress, in Galle on the south coast.

Greenfield The firm is planning to put 90 million US dollars in to four new hotels, Samarawickrama said.

Amaya Sands, in Wadduwa in the south western coast will be a 120 room hotel costing 15 million US dollars.

"Foreign architects are finalizing the designs. The concept is there and hopefully by 2012 we should be able to put this out in to the market."

In Negambo, north of Sri Lanka's capital Colombo the firm is planning a 30 million US dollar 200 room hotel on a 14-acre land, for which architectural designs are being finalized.

In Kalpitiya, further north, it is planning a 30-room chalet type property estimated to cost 15 million US dollars on a 24 acre plot of land. The group is hoping to start on it by February 2011.

Amaya is also planning a 20 million US dollar 200 room resort on a 10-acre land it owns in Mirissa, near Matara in the south coast of the island.

"Development of the southern highway we feel that time of getting to places like Matara will be shortened," Samarawickrama.

Expansion
Amaya Leisure would also spend 10 million dollars expanding existing properties.

Under the expansion Amaya Lake would get 25 rooms, a restaurant, Amaya Hills would get a 20-room luxury wing with heated swimming pools and Amaya Reef would get 10 more rooms pushing the total to 60 rooms.

Colombo's Continental Hotel, now owned by listed Hayleys group has connections to Amaya through it key shareholder Dhammika Perera, who owns the Vallibel group. The group has grown after it came under Perera's control.

"Continental is also on the verge of spending 10 million US dollars in reifurbishging the property. They have another 50 million dollar development in the back of the hotel to develop further bedrooms'.

Amaya was also looking at Maldives, India and Oman, where companies like Aitken Spence already have a presence.