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DARANA CHUDASRI
Central Plaza Hotel Plc has launched a 3.2-billion-baht property fund to raise capital for business expansion.
The Centara Hotels & Resorts Leasehold Property Fund, managed by Kasikorn Asset Management, will take a 30- year lease of the Centara Grand Beach Resort Samui, owned by SET-listed Central Plaza Hotel (CENTEL).
The five-star, 202-room hotel has been open for 13 years and is located on a 25-rai plot along Chaweng Beach.
Central Plaza, one of the country's largest hotel operators with 12 hotels and 2,799 rooms under its management, will continue to manage the hotel during the lease. It will also invest 25-33% in the property fund, with the rest held by general investors.
Kemachart Suwanagul, the head of property fund management for Kasikorn Asset Management, said rental revenues were guaranteed for four years with a yield of at least 9% per year.
From March 2009 the fund will pay quarterly dividends set at a minimum of 90% of net profits. Over the 30-year lease period, the internal rate of return is projected at 11-12% per year.
The minimum investment for the fund is 10,000 baht. The initial public offering period will be Sept 8 to 18. Units will eventually be listed on the Stock Exchange of Thailand.
Ronnachit Mahattanapreut, senior vice-president of finance for Central Plaza, said the company planned to bring three hotels in Krabi and Phuket into the Centara Hotels & Resorts Leasehold Property Fund within the next two to three years. He said the size of the fund was forecast to rise to 10 billion baht.
The Centara Grand Beach Resort Samui, which completed renovations last year, had an occupancy rate of 79% in the first half, up from 72% to 73% in the same period last year. Occupancy rates for the full year are projected at 79%, up from 67% to 68% in 2007, when the hotel was under renovation. Over the past six years Mr Ronnachit said average occupancy had been between 75% and 80%.
The hotel forecasts revenues this year of 530 million baht, up from 450 million baht last year. Room revenues account for 60% of total revenues, with food and beverages supplying 30% and other services the rest.
Mr Ronnachit said Central Plaza expected tourist revenues to rise heading into the fourth quarter, with bookings now for September at 92% and for October at 80%. Around 70% the Samui hotel's guests are from Europe and the rest are from Asia. Average stay is 7.2 days.
He added that Central Plaza projected revenues this year at eight billion baht, up 20% from last year thanks to new revenues from the Centara Grand and Bangkok Convention Centre at Central World.
Growth is forecast to continue next year at 20%, with revenues rising to nine billion baht thanks to new hotels in Pattaya and the Maldives.
Central Plaza reported second-quarter profits of 30 million baht, up 58% from the year before.
Shares of CENTEL closed yesterday at 4.82 baht, up six satang, in trade worth 4.09 million baht.
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