Listed resort hotels poised to cater to growing tourism
View(s):With more tourists preferring to experience out-of-Colombo tourism, Sri Lanka has seen an improved demand shifting to resort hotel segment from upscale city hotels, according to analysts. Keells Hotels, Aitken Spence Hotels and Jetwing are some of the leading players in the listed resort hotel segment. “The industry as a whole is well poised to cater to the growing demand with increased room inventory, reconstruction and refurbishments of properties coupled with expanding regional presence,” an analyst told the Business Times. Most resorts are in the path to benefit from the rapidly growing industry, he added.
But this isn’t true for city hotels, sector analysts say. A good example is Asian Hotels and Properties (AHPL) that owns the Cinnamon Grand and Cinnamon Lakeside hotels which reported weak results for the quarter ended June 30, 2018. Its revenue was down 14 per cent and profits were down sharply by 77 per cent.
Analysts say that many city hotels have likely been impacted by the opening of the Shangri La hotel with 500 rooms. In recent times it has surpassed the occupancies in peer hotels and is patronised by high end travellers.
Analysts say that competition stemming from peer countries in the region and the lack of trained workforce are major deterrents faced by the industry.
“Rapid growth and expansion in informal tourism sector is competing for the market share with more affordable options,” the analyst added. Increase in oil prices, stable currency, etc are expected to further fuel the growth momentum of the industry, he said.
The Sri Lanka Tourism Development Authority estimates an addition of 20,720 registered rooms by 2020 and 25,000-30,000 employees a year are required to cater to the ever-increasing tourist arrivals. Sri Lanka’s tourist arrivals for the first six months of 2018 grew by 15.3 per cent compared to the same period in 2017.