<article><a style="color: #000080;" href="http://www.theerawan.com/index.php">The Erawan Group</a>, one of Thailand&#8217;s major luxury hotel operators, plans to invest 10 billion baht ($282.8 million) over the next five years on capacity expansion.</article>

<a style="color: #000080;" href="http://www.theerawan.com/index.php">The Erawan Group</a>, one of Thailand&#8217;s major luxury hotel operators, plans to invest 10 billion baht ($282.8 million) over the next five years on capacity expansion.
The group is looking at nearly doubling its capacity from 5,676 rooms in 33 hotels to 10,000 rooms in 95 hotels across Southeast Asia.
It intends to invest half the budget in Thailand while earmarking up to 30 per cent in the Philippines. The company will use the remaining amount for acquiring budget hotels in other countries and renovating existing hotels.
In 2016, it will spend 1.7 billion baht on the construction of 10 budget hotels under ‘<a style="color: #000080;" href="http://hopinnhotel.com/en/">Hop INN</a>’ brand.
“We will complete and launch one [Hop INN hotel] in the Philippines and the other six in Thailand this year. If everything is on track, we will operate 40 hotels by the end of this year,” company’s president Kamonwan Wipulakorn told the media.
The revenue is projected to surge 15 per cent from 5.3 billion baht last year to 6 billion baht this year. It anticipates the revenue will hit 10 billion baht by 2020 with an annual average growth of 11 per cent from 2017-20.
“In the last two years, we explored every country in Asean and found that Thailand and the Philippines would be the most attractive destinations to develop budget hotels, especially the latter where the supply is little and the demand is rapidly growing,” she said.
The source of funding will come from cash from operation and financing, including bank loan and bond issuance. It is considering the right timing to issue bond this year, she added.
It targets the occupancy rate in 2016 will be around 80 per cent, higher than 73 per cent last year, thanks to the economic recovery and the weaker baht, which should attract more foreigners to visit Thailand.
Meanwhile, it is discussing with the Office of Securities and Exchange Commissions to form a real estate investment trust, which should be finalized in the first half of this year.
“We will sell two hotels into the REIT, of which the size should be around 1.5-1.7 billion baht, to give the better return to our shareholders,” the president said.
The Erawan Group currently operates 33 hotels under nine brands comprising Grand Hyatt Erawan, The Naka, Courtyard Marriott, JW Marriott, Renaissance, Mercure, Holiday Inn, Ibis and Hop INN. It also manages two office buildings, which are Erawan Bangkok and Ploenchit Centre.
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The Erawan Group plans to invest 10 billion baht ($282.8 million) over the next five years to set up new hotels across the Southeast Asia.

Thailand: Luxury hotel operator Erawan to invest $283m in capacity expansion, M&A

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