Tourism Development in Northwest Sri Lanka Attracts Investments. Construction Work of a Hotel in Kuchchaveli Underway

26th April 2011, www.island.lk, By Mario Andree

Sri Lanka Convention Bureau General Manager Vipula Wanigasekera said construction work of one hotel in Kuchchaveli, Northwest Sri Lanka off Trincomalee, has commenced after investors successfully completed interviews with the Treasury. He declined to disclose who the investor was.

The Island Financial Review last month reported that the government signed five MoUs with three local and two international investors to develop Kuchchiveli.

Authorities are planning to lease 500 acres of land in the North East coast to potential investors at Rs. 20 million an acre in order to develop tourism infrastructure.

Wanigasekara said only one bid was so far finalised while the others were still being processed.

He said the Kalpitiya islets project also captured the attention of many large investors who are pouring in their proposals, however the government is yet to make a decision.

The Kalpitiya project earlier attracted 11 bids which were rejected because the government felt that the islets had more earning potential.

Sources told The Island Financial Review the new hotel in Kuchchaveli was being built by the International Construction Consortium. Further, 11 plots of land also have been recognized in Hambanthota for development and already 7 investors have sent in their proposals.

Sri Lanka expects 800,000 tourists this year while capacity constraints loom around the country, several investors have bided to develop properties in order to support the growth.

Tourist Hotel Association, President, Anura Lokuhetty said the country would reach 800,000 tourists this year while more rooms are being built to support the future growth.

He said Sri Lanka is on track of achieving 2.5 million tourist arrivals by 2016 while the room capacity is expected to increase by more than 30,000.

Last year, arrivals grew 46.1 percent recording 654,476 tourists, for the first three months this year increasing by 34.1 percent to 215,124.

Lokuhetti said considering last year’s growth the sector expects the numbers to grow within the capacity available.

The country has 15,000 hotel rooms in the formal sector and 7,000 in the informal sector, which could support nearly 900,000 at an average 6 nights stay.

Related Info :

• Land for Lease in North & East Sri Lanka for Rs20mn an Acre for Tourism Development

• Masterplan for Tourism Development of Kuchchaweli Area - The Longest Coatal Belt of Trincomalee

Land for Lease in North & East Sri Lanka for Rs20mn an Acre for Tourism Development

07th February 2011, www.island.lk, By Mario Andree

The government is planning to lease out land at Rs. 20 million an acre on a 99 year lease in the North and East for tourism development, and investors would be served on a first-come-first-served basis as long as they can afford it.
Sri Lanka will lease 500 acres of land in the North East coast to potential investors in order to develop tourism infrastructure, a tourism official said.

Sri Lanka Tourism Development Authority Chairman Dr. Nalaka Godahewa told The Island Financial Review that the Cabinet had granted approval to sell land in the North and East under a 99 year lease agreement at Rs. 20 million an acre.

A stretch of land in Kuchchaveli, North West off Trincomalee has been identified for this purpose.

He said the land would be leased out on a first come first served basis after one-on-one interviews with the Treasury. "Who ever applies and can afford to pay for it, will be leased the land."

Denying recent reports in the press, Dr. Godahewa said the Kalpitiya island resorts project, which attracted 11 bidders, was going ahead. He said the bidders had been shortlisted to six and was handed over to the Cabinet-approved procurement committee for evaluation. "The results are still pending," he said.

However he said most likely Kalpitiya would also follow the same pattern of Kuchchaveli to develop tourism infrastructure.

Related Info :
• Sri Lanka Gets $500mn Tourism Proposals for Ten Kalpitiya Islets off North Western Coast

• 60 Investors to Build Hotels in Trinco in the Newly Proposed 8-kilometre Tourism Zone on the Kuchchaveli coast, Trinco, Sri Lanka

Sri Lanka's Aitken Spence to Invest $78mn on Hotels

12th July 2010, www.dailymirror.lk

Sri Lanka's Aitken Spence group is planning to put 78 million US dollars in to the leisure sector after a war ended in Sri Lanka with new hotels in the south western coast being started first, an official said.

"We envisage a post-war investment around 9.0 billion rupees (78 million US dollars) given the opportunities that we have," Aitken Spence director Gehan Perera told a forum organized by Acuity, an investment bank.

A 30-year war which had hamstrung tourism ended in May 2009, and arrivals are up over 40 percent this year. Aiken Spence owns or operates 27 hotels with 2,020 rooms in Sri Lanka, Maldives, India and Oman.

The firm will refurbish and expand a 94-room hotel in Kalutara, formerly known as Golden Sun which it only managed at first but has since taken full control after a Singapore based shareholder sold out.

A hotel in Beruwala is being done up and will be relaunched as Heritance Mahagedera in early 2011 positioned as a 64-room specialized Ayurveda (a traditional South Asian healthcare system) resort.

Its premium hotels, branded Heritance, includes a 5-star resort next to a lake in Kandalama in central Sri Lanka, a former tea factory in the central hills and a beach resort in Ahungalle in the south western coast.

Perera said a 10 acre land next to Heritance Ahungalle was slated for development. Earlier reports have said the group was planning a venture there with the Six Senses leisure group.

"We have another seven acres next to Heritance Mahagedera in Beruwala. This is also under discussion," Perera said.

"In Nilaweli (in north eastern Sri Lanka) we have a little over 100 acres. It is also on the drawing board. We are looking at a fairly integrated development there."

Perera said the group was looking at Yala in the deep south of the country, where a popular national park is located and was also scouting for more opportunities in the north. In addition to Nilaweli it was also looking at more projects in eastern Sri Lanka.

The government recently gave land to developers in Pasikuda and another tourism zone in Kuchchaveli has also been opened.

60 Investors to Build Hotels in Trinco in the Newly Proposed 8-kilometre Tourism Zone on the Kuchchaveli coast, Trinco, Sri Lanka

01st November 2009, www.nation.lk, By Rohan Abeywardena

More than 60 prospective investors have applied to build hotels in the newly proposed 8-kilometre tourism zone on the Kuchchaveli coast, Tourism Ministry Secretary George Michael said yesterday.

Most of the applicants are joint collaborations with foreign investors, it is learnt.
Michael said a crucial meeting among all stakeholders in the proposed project, expected to inject hundreds of millions of dollars in investment into Trincomalee District will take place at the Trincomalee Kachcheri on Friday November 9, chaired by him.

Those invited, he said included the prospective investors, Chief Minister Sivanesaturai Chandrakanthan, District Secretary, Land Commissioner, Tourism Development Authority, UDA, Coast Conservation Department, Environment Ministry, RDA, CEB, the Water Supply and Drainage Board and SLT.

It is learnt that Chief Minister Chandrakanthan is not happy with the project prepared by the UDA at the request of the Tourism Ministry as he has repeatedly argued that alienation of lands is a devolved subject under the 13th Amendment. A few months ago the government halted all ad hoc state land alienations done there amidst allegations that it was happening amidst much corruption. There is a severe demand for coastal land in the district with unspoilt beaches for tourism with the ending of the war in May.

The new tourism zone will come up on approximately 500 to 600 acres of state land. The UDA plan includes public and recreational areas and new roads. TDA, the successor to the former Tourist Board will undertake the development of public areas.

Secretary to the Chief Minister Ranjini Nadarajapillai, said they had not received any invitation to the conference, however, Michael assured that it was on the way.
The Ministry Secretary said there was neither acquiring of anyone’s land nor anyone walking away with any land and whatever investment there would be for the benefit of the hitherto undeveloped areas and most of the jobs created would also go to the people of the region.

The central government, he said was in it only to ensure standards are maintained and approvals are done according to the rules more in a consultative approach, while the actual allocation of land for each hotel project can be done by the Provincial Council, the GA and the Land Commissioner.

The Friday’s meeting is primarily to brief investors on the guidelines and to define timeline for the investments, he said.

Presentation kuchchaweli

View more presentations from BOISriLanka.