Return
to Story Page
To print: Select File and then Print from your
browser's menu
David Brunnstrom
SIEM REAP (Cambodia), Oct 1: For a man who has committed $65 million to the tourism industry of a country that still slugs out its political battles with rockets and guns, hotelier Richard Helfer does not appear excessively nervous.
The president of Singapore-based Raffles Holdings Pte Ltd believes that here as elsewhere, he has got his sums right, although Cambodia has clearly become a labour of love.
In three years, Helfer has visited the country 94 times and despite its continuing turmoil, succeeded in recreating two of Asia's most spectacular and expensive hotels: Le Royal in Phnom Penh and the Grand Hotel D'Angkor at Siem Reap.
"Before we go into a market, we do studies to determine what we feel the pain threshold will be," he told Reuters in an interview. "Coming into the Cambodian market, our feeling was, and I think continues to be, that there is a great upside.
"There is major pent up demand. The visitor potential, particularly when you have one of the wonders of the world to come in and see,is really quite large."
Both Cambodian hotels owned by Raffles, a unit of Singapore's DBS Land, are seriously upmarket establishments offering exquisite service and old world charm to travellers willing to part with $300 or more for a night's stay.
The Grand provides the most luxurious accomodation available for visitors to the ancient temples of Angkor, a world-class draw on a par with Egypt's Pyramids or India's Taj Mahal.
But the last thing anyone ready to pay $300 a night for lodgings wants to experience is the sort of bloody political unrest seen in Phnom Penh this month or the grenade attack just before the opening of parliament in Siem Reap last week.
"The only reason people don't come is they are scared to come. When there are travel advisories and there are other things going on and if there's fighting, they don't travel.
"Obviously, the numbers coming in are down and those kind of numbers we can't be happy with," he said.
Despite the downturn in the Asian market due to economic turmoilin much of the region, Helfer said there was still major pent-up demand from Europe and the United States.
"In these markets, people plan months in advance and you need to have these people having a feeling of stability and a feeling that they can go ahead and plan to do Cambodia," he said.
"But I would say I believe this is one of the few places that could look to a better 1999 than 1998. Next year, assuming we can get back to the situation in 1996, the return on this hotel would be very good."
Helfer said that despite his firm's ambitious expansion in the past two years, its exposure to Asia's economic turmoil had been relatively light, as it has no properties in countries worst hit by the crisis, like Thailand, Malaysia and Indonesia.
Raffles has gone from holding three properties in Singapore in 1996 to 11 worldwide this year, with acquisitions in Cambodia, Britain, Germany and China.
If anything, Helfer said, the Asian crisis had presented unexpected opportunities. He said the firm's originalplan had been to look at expansion in Asia through second-tier hotels.
"Because of the economic situation, there is some opportunity to look for first-tier hotels. "Because of the way some markets find themselves, there could be hotels that could fit well with what we're doing, and those hotels could join us either in management contracts or maybe as joint-venture projects," he said.
Raffles was looking at announcing new hotel acquisitions in Europe and Asia this year and next and also in the US market.
"We continue to look at the east and West coast. The problem with the American market is it has got very expensive to go into at this particular time, but we are still looking."
Helfer declined to forecast earnings figures but said turnover had improved as the firm held more properties. "Uncertainty in financial markets certainly has an effect in hotels, particularly when you are trading in the top two tiers. I would think (this year) we would be relatively flat and I hope that by 1999 we would seesome pickup.
"But I certainly don't think 1998 has been a disastrous year," he said.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
------------------------------------------------------------
This story was printed from Net Express located at http://www.expressindia.com. Net Express provides a portal to India, with news from The Indian Express and The Financial Express along with sites on travel and tourism, the entertainment industry, the power sector, the environment and much more.
------------------------------------------------------------