The Other Boom

Hotel Galore

Judging from the number of new hotels opening recently and new ones to come onstream further down the road, it looks like Malaysia is set for a tourism boom in the months ahead. In fact, from all evidence, we are already well and truly in the midst of a boom. Despite the massive Japan earthquake and tsunami early March, Malaysia expects tourists from countries such as China and India to increase due to several factors, chief among them is the growing affluence of people from these two economic powerhouses.

Malaysia is also blessed with being the hub of Air Asia which is bringing tourists from many countries along its expanding international routes, such as India, China, South Korea, the Middle East, Europe, Australia, Thailand and Indonesia.

Other factors are rising government investments in infrastructural projects, attractive luxury destinations, and the emphasis on our great variety of food. The recognition of Penang and Melaka as UNESCO world heritage cities also helped to put Malaysia on the international travellers’ map. Further, our growing status as a haven for medical tourism, particularly in Penang, attracts a continuous flow of medical tourists from countries such as Indonesia, the US and Europe.

During the Budget 2011 announcement in October last year, the government was even prepared to allocate RM100 mil to part-finance developer and resort operator Karambunai Corp’s integrated eco-tourism resort in Kota Kinabalu. The RM3 bil project is expected to take about five years to complete.

No ownership restrictions

By 2020, Malaysia needs 50 per cent more hotel rooms to cater for the anticipated tourist arrivals of 36 mil, so declares our good Tourism Minister Datuk Seri Dr Ng Yen Yen recently. According to her, tourist arrivals in 2010 were 24.6 mil compared with 23.6 million in 2009, an increase of 1 mil tourists within a year.

If we extrapolate that and assume that we get an increase of 1 mil arrivals per year, we would indeed reach 36 mil in 11 years’ time, thus requiring more hotel accommodation. Whether or not we will reach that figure remains to be seen.

Meanwhile, on the ground, sentiments are bullish especially from foreign investors as there are no restrictions on foreign ownership of hospitality assets in Malaysia.

Hotels with foreign ownership and/or foreign management that are newly launched or confirmed coming are the recently launched InterContinental in Jalan Ampang, while the Pullman Kuala Lumpur Bangsar is expected to launch in November and the Grand Hyatt Kuala Lumpur in Jalan Pinang in 2012. Hilton Doubletree opened its doors near KLCC a few months back.

Over the next 5 years, expect to see St Regis Kuala Lumpur, Best Western Premier Dua Sentral, Hilton Garden Inn, Movenpick, Park Regis Kuala Lumpur and Four Season Place vying for the tourist dollars.

These will add to the 30,000 rooms contained within 236 hotels already in operation in Kuala Lumpur alone. Nationwide, as at February this year, there were a total of 1,610 hotels in the three to five star category and budget hotels offering a combined total of 161,117 rooms

Though average occupancy rate in KL hovers around 67% in 2010, which was 4.2 % higher than in 2009, the expected increase in tourist arrivals – 25 mil targeted this year, would generate demand for all types of accommodation including homestays. The latter which have proven popular has absorbed quite a bit of the incoming traffic.

Locals catching up

Among local hotels, the well-known ones are Cititel, Seri Malaysia and Naza Talyya chain of hotels, which cater to the masses while Royale Bintang serves more upmarket clientele. Tune Hotel is fast closing in on its competitors, offering refreshingly 5-star facilities at 1-star price. Who wouldn’t fall for that?

But Tune will soon be more prevalent overseas. By 2015 Tune hopes to have 30 hotels in India and 64 elsewhere in Southeast Asia and China, compared with only 20 in Malaysia. More are planned for Australia and the Middle East.

The world’s fourth largest hotel incidentally is located in Malaysia at First World Hotel, Genting Highlands. Even with a combined total of over 7,000 rooms for all 5 hotels in Genting, the hotels at the casino resort are fully booked every Saturday and during school and public holidays.

Thus, as far as Genting is concerned, there is a shortage. But what about the rest of the country? Admittedly, during school and public holidays, all hotels in holiday destinations in Malaysia are practically filled up. Apart from Genting, Malacca, by virtue of its proximity to Singapore and its world heritage city status, is seeing fully-booked hotel rooms practically every weekend too. Incidentally, Malacca recorded the highest number of tourist arrivals last year.

‘Stampedes’ on the way

Fears that there might be a glut might be too premature. It’s perhaps too early to tell, but judging from the number of hotels that are in the pipeline, the consensus is that there is a dire need for more hotel accommodation.

And why ever not? Check out the statistics. Malaysia is continuing to emerge as a top travel destination in Asia, appearing on several travel-trend forecasts such as the Specialty Travel Agents Association’s (STAA) Top 10 Travel Trends for 2011.

Further, according to Abacus International, a global technology partner for the airline industry, Asia is en route to become the top travel region in the world as early as 2015. Even several economic crises were not able to stem the tide of tourist stampedes coming our way.

Like it or not, Asia is at the cusp of a big tourism boom. And Malaysia is one of the biggest beneficiaries of that.

Unique Malaysian tourism properties

Golden Palm Tree Sea Villas and Spa
Golden Palm Tree Sea Villas and Spa, situated at the ambitious 5,000-acre mixed development paradise in Sepang Goldcoast is an unparalleled retreat with 393 units of sea villas. It is a first in Malaysia that takes the shape of a palm tree and the world’s first that is built on stilts. It stretches a lengthy 1.5 km out to the well-sheltered Straits of Malacca.

Developer Sepang Goldcoast Sdn Bhd, a joint venture of Permodalan Negeri Selangor Berhad (PNSB) and Sepang Bay Sdn Bhd, has even taken the extra y step to safeguard the environmental quality of the area by working closely with the Malaysian Nature Society (MNS).

Treehouse Hotel, Sarawak
Located on the shores of the South China Sea and at the foot of mystical Mount Santubong, the Permai Rainforest Resort in Sarawak is a carefully designed eco-resort with the purpose of minimising impact on the natural environment. Just 25 km north of Kuching, the capital of Sarawak, .it provides a unique rainforest experience for the guests. They can choose to stay in tree houses which can accommodate 2 persons, single or double storey cabins or bring their own tent/sleeping bags to camp with family and friends at the campsite located towards the end of the forest.

Guests can enjoy jungle trekking and overnight trips into the forest as well as high ropes courses, sea kayaking, evening mangrove cruises and dolphin watching.