HVS Monday Musings: Rethinking Heritage Tourism in the Post-COVID India

By Mandeep S Lamba and Dipti Mohan
India is known for its rich heritage and cultural diversity. Heritage tourism has the potential to lead the revival of travel & tourism sector in the country and collaborative efforts by the public and private sectors will be crucial going forward.

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S Hotels & Resorts to Acquire Additional 50% Stake in 26 Hotels in the United Kingdom

Thailand-based S Hotels & Resorts Public Company Limited (“SHR”), a subsidiary of Singha Estate Public Company, announced their acquisition for the remaining 50% stake of 26 hotels located in the United Kingdom (“UK”). 500,000 ordinary shares of the company, FS JV Co Limited (“FS JV”), would be acquired from SHR’s existing partner, FICO Holdings UK Limited for TBH560 million. The current portfolio of FS JV consists of 26 hotels with a total of 2,886 rooms across the UK, which are currently operating on France-based multinational hospitality company, Accor’s Mercure franchise model. SHR’s Chief Executive Officer, Mr Dirk De Cuyper, noted that this acquisition aims to improve management flexibility and increase the potential for these 26 hotels. In addition, SHR aims to capitalise on the UK’s projected strong domestic tourism recovery, through the country’s swift and efficient vaccination progress, paired with its fading Brexit uncertainties. After the 100% acquisition of UK hotel portfolio, SHR estimates to generate THB2 to THB3 billion revenue per year. Currently, SHR pipeline consists of six new and repositioned properties scheduled to open in 2021, and the company aims to double its portfolio from 39 properties to 82 hotels by 2025.

Iris Capital Acquires Raffertys Resort in Australia

Raffertys Resort, located in Lake Macquarie, has been acquired by Sydney-based private hospitality group, Iris Capital, an at undisclosed sum through Australia-based HTL Property. Situated within a 90-minute drive from Sydney and a 30-minute drive from Newcastle, the freehold property spans 15,303 square metres, featuring 73 villas, restaurants, reception, five conference rooms, bistros, and additional spaces available for future expansions and further development. This acquisition follows Iris Capital’s AUD180 million transaction in November 2020, where 17 Ibis-branded hotels in Sydney, Melbourne, Brisbane, and Canberra were added to their portfolio. HTL Property Director Nic Simarro mentioned that the competition for investment opportunities has significantly increased in recent times, as both traditional and new entrant investors seek quality accommodations within various domestic regions, especially those situated within two hours of an airport.

Connect@Changi Facility at Singapore EXPO Opens to Allow Business Travellers to Meet Without Quarantine

Singapore has piloted Connect@Changi, a “bubble-wrapped” four-star hotel cum business centre for short-term business travellers to stay and have in-person meetings without prior quarantine. The first phase was launched on 18 February 2021, with 150 premium guest rooms and 40 meeting rooms that can hold four to 22 attendees. After it is fully operational later this year, it can host up to 1,300 travellers at any time. Room rates starts at SGD 384, inclusive of three meals, mini-bar, toiletries, Wi-Fi, two-way airport transfer and Polymerase Chain Reaction (“PCR”) tests which is required on day three, seven and 14 of the stay. Travellers who opt for the Connect@Changi will be transported to the facility directly after taking a PCR test at the airport. After tested negative, they will be able to have meetings in special meeting rooms with air-tight glass panels. There will be separate entrances, exits and ventilation systems for travellers and visitors from Singapore. This facility marks the start of the Connect@Changi scheme which will open Singapore’s borders to business travellers with high economic values. With the resumption of business travel, Singapore hopes to speed up economic recovery and preserve its role as a global business hub.

Indonesia Sets Up Two More Special Economic Zones in East and West Java

The Lido in West Java and the Java Integrated Industrial Ports and Estate (“JIIPE”) in East Java, have been approved by the Indonesian National Council as two new special economic zones (“SEZs”). They are projected to attract USD19.3 billion in investments, which would support the business ecosystem. According to the Indonesian Coordinating Minister for Economic Affairs, Airlangga Hartarto, world-class theme parks, golf courses, retail and dining, accommodation, and creative economy is planned for the Lido.  Developed by Indonesia-based MNC Group, the tourism SEZ is anticipated to increase foreign and domestic tourists to 63.4 million until 2038, attract foreign exchange inflows amounting to approximately USD 4.1 billion and employ 29,545 people over 20 years. JIIPE SEZ, located in Gresik city, will focus on business development in metal, electronics, chemical, energy and logistics industries. The area will consist of a 2,933-hectare industrial zone, a 400-hectare port, a 765-hectare residential estate and a 1,761-hectare industrial complex. Once operational, it is expected to generate USD16.9 billion in investment and contribute exports valued at USD10.1 billion per year. As of the end of 2020, Indonesia has 15 SEZs with an investment commitment of IDR70.4 trillion (USD5.03 billion), of which IDR23.1 trillion realised.

Absolute Share Price Performance, as on 26 February 2021