The prospect of 40 million foreign tourists coming to Thailand next year is too big a draw to ignore for boutique US hotel company Standard International.
Better known for its trendy hotels in locations such as Miami Beach and New York, Standard International plans to open hotels in four locations in Thailand by 2021 worth about $150 million, CEO Amar Lalvani said. That’s part of a strategy calling for 20 new properties over the next five years, including in London, Paris and Milan.
"Growth is much faster in Asia,” Mr Lalvani said in an interview Thursday. “Thailand is our starting point and from here we are looking at opportunities throughout the region.”
A surge in Chinese holidaymakers has stoked the expansion in Thailand’s tourism sector, which now accounts for roughly a fifth of the economy. The industry suffered a setback in July after more than 40 Chinese tourists died when a tour boat sank off the coast of Phuket, highlighting the challenge of managing the boom. While the tragedy may curb visitor growth temporarily, the nation remains on course for record arrivals next year.
Thai developer Sansiri Plc in 2017 acquired a 35% stake in Standard International for $58 million. Sansiri and other local investors will help fund Standard International’s planned hotels in Bangkok, Hua Hin, Phuket and Koh Samui.
Sansiri will build residential projects next to the hotels in the first three locations, targeting young professionals who want apartments with hotel-type services, Mr Lalvani said.
Standard International is in talks with investors to build hotels in Singapore, Hong Kong, Tokyo and Shanghai. Lalvani expects as much as three-quarters of revenue to come from Asia in the next five years.
The firm’s hotels include features such as nightclubs and restaurants to attract local fashionistas, as well as foreign tourists.
“This helps diversify risk because the hotel business can go up and down very quickly,” Mr Lalvani said.