SM Investments to build hotels near malls

CEBU, Philippines – Looking at the huge potential of the tourism industry, SM Investments Corporation’s (SMIC) hotel and entertainment segment unveiled plans to roll out a mid-end hotel brand nationwide that will maximize their properties near its existing regional malls.

With an earmarked budget of P2 billion, SMIC plans to open 15 branches of Traveller’s Hotel nationwide, which will capitalize on the flourishing domestic and foreign tourism industry in the country, said SMIC executive vice president and chief financial officer Jose T. Sio in an interview.

Sio said the planned 15 branches will be put up by the company in a span of 10 years and among the initial locations being considered include Cebu, Iloilo, Bacolod, Davao, Baguio, Naga and other major cities with existing SM Mall operations.

He said that the first branch of Traveller’s Hotel will be opened in Bacolod City near the SM mall. The project is currently under its design stage and construction is targeted to kick off anytime this year.

“We want to maximize the usage of our properties near our SM Malls. We saw the potential of putting up quality hotels near our malls so we can provide a synergy of services to our guests because they can get all their needs in one location,” said Sio.

He said that the Traveller’s hotel will be a mid-level boutique hotel that will specifically cater to the growing domestic tourism in the country.

Sio said that the hotel will have around 50 to 100 rooms and the average accommodation rate per night will cost around 50 US dollars or around P2, 000 to P2, 500.

Meanwhile, in Cebu, Sio said they are looking for available space that is adequate enough for the hotel project as they are already anticipating the operations of their P2.5 billion Radisson Hotel project near SM City Cebu that is targeted to open this December.

He said that they are also allocating around P400 million for the construction of a smaller version of the SM X convention center here in Cebu near the mall. Construction is targeted to start during the latter part of 2010 and will be completed by 2011.

Sio said that SMIC is planning to acquire more land at proper reasonable prices for their banks, malls, residential and hotel operations and planned expansions.

Meanwhile, SMIC president Harley Sy said that their plans of acquiring lots in the South Road Properties (SRP) here in Cebu for their mall expansions will depend on present situations. He, however refused to give out more details about these plans.

“We believe in Cebu’s local economy. Your tourism sector has done a very good job and we can even say that now it’s even safer to be here than in Manila. We continually look out for areas in Cebu where we can expand our business and provide more service to the local public,” he said.

He said that SMIC is taking advantage of the slowdown in the property sector that resulted from the present global economic crunch as they are currently acquiring more properties near their existing mall operations, and areas near transport hubs and schools for their future expansion projects.

“We came up with our own business model to take advantage of what is selling at the moment considering the global crisis,” said Sy.