U.S. Travelodge hotel chain will expand in Thailand
Travelodge, a United States-based global budget hotel chain, is rolling out the welcome mat in Thailand with plans for an aggressive expansion from two hotels to 50 by 2020, its local executive said last week, as the head of another U.S. hotel chain, Standard International, said he is bullish on Thailand and the region after Thai developer Sansiri bought a 35 percent stake in his company.
Travelodge has over 1,000 hotels worldwide, but its total number of properties in Asia is small compared to other regions. Company executives recently decided to expand, however, on the world’s most populous continent, and Thailand figures prominently in their plans. The Kingdom’s large and solid tourism industry translates into strong demand for hotel rooms, even though the market has plenty of competition.
“For Thailand our aim is to have a minimum of 15 properties or 3,000 rooms by the end of 2018. We believe in the longer term our expansion will encompass 50 properties or 10,000 rooms by 2020,” said Jonathan Wigley, chief executive of Travelodge Thailand.
Thailand had been home to four Travelodge hotels from 1989 through 2000, but disagreements with local partners led to the company withdrawing from the market. It returned this year, opening Travelodge Pattaya with 168 rooms, and the Travelodge Sukhumvit Soi 11 in Bangkok with 224 rooms, which opened just this month. Occupancy at both hotels has been running between 80 percent and 90 percent.
Wigley said that some of the cities and provinces where Travelodge plans to open properties by 2020 include Chiang Rai, Chiang Mai, Khon Kaen, Hua Hin, Rayong, Phuket, Khao Lak, Koh Samui and Krabi, in addition to more hotels in Bangkok and the Jomtien area of Pattaya.
Stephen Burt, the chairman of Travelodge Asia, said the mid-scale segment offers more growth opportunities than the upscale and luxury segments. What matters to customers, he added, are great locations, a value proposition on pricing and a high level of security.
Meanwhile, local real estate developer Sansiri acquired a 35 percent stake in U.S.-based hotel operator Standard International for a reported $58 million. Sansiri’s goal is to diversify into the hospitality and media industries as a way of balancing out risk so it is not as vulnerable to the vicissitudes of the Thai real estate market.
Amar Lalvani, chief executive of Standard International, said the Sansiri purchase will not change the direction of the company but will change its speed. The company is bullish on expanding in Asia and in Thailand in particular, he said. Standard had been completely U.S.-based until last year when it opened its first property in London, but is now planning to aggressively expand overseas.