Financial Times

Top hotel chains upbeat on tourism industry
Good performances in the hotel sector along with the peace process has rekindled foreign investor interest with many projects in the pipeline including those from Ritz Carlton, Hyatt and Sheraton, along with Maldivian resort owners.

Dr. Prathap Ramanujam, Secretary of the Ministry of Tourism told The Sunday Times FT that these international chains are gearing up for up market investments worth nearly US$ 150 million.

Sheraton has already signed an agreement with the Ministry of Tourism to build a five star property at D.R. Wijewardene Mawatha, Colombo 2. "We are finalising the details with the Urban Development Authority and looking at leasing the land," he said, adding the investment for the project is US$ 35 million.

The project will start by next year, once the formalities are cleared with the relevant authorities. Another hotel chain, Four Seasons, has shown interest in a chalet venture. "This project is planned to be built in a coastal area," Ramanujam said. The Sri Lanka Tourist Board (SLTB) is currently having talks with the chain.

Meanwhile the Hyatt Group will manage a luxury apartment complex cum hotel to be built by Ceylinco Consolidated in Colpetty facing The Colombo Plaza. George Michael, Additional Secretary, Ministry of Tourism said this high rise with 43 stories and 240 rooms will have an investment of nearly US$ 30 million and is to be started by next year.

The Ritz Carlton is also keen to develop a property in the island and has expressed interest. "They will be presenting a project proposal," he said. Universal Group of Maldives is planning a large project at Balapitiya. Michael said the Universal Group which has zeroed in on a 10 acre land is planning a large 50 room chalet type hotel project.

"This land, belonging to the Ministry of Education, presently houses a teachers' hostel," he said, adding the Ministry of Tourism is currently negotiating with the Ministry of Education to shift the hostel to another location.

"The Universal Group is prepared to put up the hostel with their own funds in any other suitable location, provided this land is sold to them," Michael said, adding that it is targeted at an up market clientele.

Michael added that a Maldivian couple is interested in a 100-room boutique style hotel at Passekudah in the east with a one million rupee investment. Michael explained that each of the rooms the foreign chains are to build will cost a maximum amount of four million rupees. All the ventures will be positioned at five star status and above.

Meanwhile, SLTB is planning to acquire 7,487 acres of land in different parts of the island to facilitate foreign investment. Apart from these foreign investments, many local investors are also bidding for up market projects.

"All these are currently at the discussion stage," T. Sooriyagoda, Director Development and Resort Management, SLTB said.

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