13 March 2012

Sri Lanka's Hemas to Build a $25mn Hotel at Kalutara

11th March 2012, www.dailynews.lk, By Shirajiv Sirimane

Sri Lankan tourism is on an upward trend with increased arrivals and revenue and the country would soon need additional rooms to meet this demand. There is a renewed interest for the leisure sector in Sri Lanka and this arguers well for the industry said Group director of diversified group, Hemas Holdings, Abbas Eusufally, speaking to ' Daily News Business' at the ITB in Berlin. He said that there are new players entering the hotel sector by building new hotels and this is encouraging.

He said the Group too has decided to embark on one of the stalled hotel projects at Kalutara. “Our plan is to build a 150 room hotel complex next to Avani Kalutara and the investment for this would be over US $ 25 million. The Avani hotel too would once again be refurbished and would close in May until next winter.

The Group is also looking at investing on two other hotel projects in the deep South and we are currently studying these proposals. “I have been attending 35 ITB events on the trot and there is a very strong interest not only from traditional markets but from other segments as well,” he reiterated.

He said similarly, the Sri Lanka leisure sector too, soon would also see a high demand for qualified staff for the human resources sector. “Without quality and a well trained staff, one cannot give out a quality product and hence well trained staff is a must. A five star hotel cannot give a two star service,” he said.

Eurfally said that hotel schools and educational institutions set up for this purpose in the country are inadequate to meet the projected demand in Sri Lanka.

“The wages paid to hotel staff may not be enough to keep trained experienced staff in Sri Lanka due to brain drain ,” he said.

Commenting on the allegation that Lanka hotel rates had increased, he said that it is only a general statement. “However I think that in a free economy hotel rooms should not have a price control and it should depend on demand and supply forces,” he said. Regulations in this area is not required.

However he said that hotel rates should be decided on quality and service where the customer should not get the feeling that they are ripped off. 'Value for money is the key.'

He also said that time is ripe now for hotels to refurbish as today the industry is getting returns

mainly due to the peace dividend and there is RoI sooner than anticipated. Eurfally said that one of the grey areas in the industry that he identifies is the lack of a proper destination marketing with a good theme for a along period of time. “Sri Lanka is not properly focusing in these investments and this aspect should improve. Today with several themes, tourists are confused.”

The expressions such as Visit Malaysia, Amazing Thailand, were very successful and they still linger in the minds of the globe tourism industry. “I think Sri Lanka should stick to 'Lanka the Wonder of Asia' and only promote this catch line for a long term,” he said.

He said that being a listed company they have an obligation towards their share holders and would do their utmost to give them good returns. “We will invest but with caution,” he added.

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