Marriott bullish on Malaysia’s prospects
MARRIOTT International Inc, which signed a landmark agreement with YTL Corp Bhd’s YTL Hotels to bring the AC Hotels by Marriott brand to Malaysia last week, is looking for more opportunities to expand and is bullish on prospects here.
Its president and managing director for Asia Pacific, Craig Smith told NST Property that the group has 30 properties in the pipeline that will open over the next three years, either in resort markets or iconic cities.
“They include signed hotel deals that are happening and other hotels we are negotiating with. Some are new hotels while others will involve conversions of existing properties. We have 30 hotels operating in Malaysia today under 14 brands. Everyone is worried we are going through a recession. But we have a pipeline that is robust and we continue to be bullish.
“Malaysia has sufficient supply of electricity and fairly high skilled English-speaking labour. Transportation is adequate and there are well-connected roads. Malaysia is growing in terms of tourism numbers and more Chinese are also visiting the country,” said Smith.
Malaysia had recorded RM41.7 billion (US$13.7 billion) in tourist receipts in the first half of this year, an increase of 6.8 per cent from the corresponding period last year.
The number of foreigners visiting the country rose 4.9 per cent to 13.4 million in the first six months of this year, up from 12.7 million in the corresponding period last year.
Asia Pacific continues to dominate Malaysia’s foreign arrivals at 70 per cent with arrivals from Singapore topping the list with 5.4 million tourists, followed by Indonesia (1.9 million), China (1.6 million), Thailand (990,565), Brunei (627,112), India (354,486), South Korea (323,952), the Philippines (210,974), Vietnam (200,314) and Japan (196,561).
Overall, the short- , medium- and long-haul markets registered positive growth at 4.7, 7.2 and 1.8 per cent respectively, compared with the first half of last year.
Taking into account these numbers, the Tourism, Arts and Culture Ministry is confident of Malaysia hitting its target of 28.1 million tourist arrivals this year as against 25.8 million last year.
As next year is Visit Malaysia 2020, the target is 30 million arrivals and tourist receipts worth RM100 billion.
EXPANDING THE AC HOTELS BY MARRIOT BRAND IN MALAYSIA
AC Hotels by Marriott is a lifestyle brand complemented by a European soul and Spanish roots. There are more than 125 design-led hotels in 15 countries and territories in Europe as well as in North and Latin America.
Smith said Marriott International aims to build the brand in Asia Pacific, including in Malaysia.
“AC Hotels by Marriott is a sexy brand designed in Europe by Europeans. We have just signed with YTL Hotels which will invest in their existing three hotels to make sure they carry the standards of the AC brand. Our role is to plug in our system and operate,” said Smith.
The three hotels that will undergo strategic conversion and fly the AC Hotels by Marriott brand flag on Dec 1 this year are Vistana Kuala Lumpur Titiwangsa, Vistana Penang Bukit Jambul and Vistana Kuantan City Centre.
They will be known as AC Hotel by Marriott Kuala Lumpur, AC Hotel by Marriott Penang and AC Hotel by Marriott Kuantan on Dec 1 this year.
The conversion to AC Hotels marks the first foray for Marriott International in the Asia-Pacific region.
YTL Hotels executive director Datuk Mark Yeoh said it is looking to aggressively expand the AC Hotels by Marriott brand in Malaysia.
“We have a lot of land under YTL Land which we can use to build new hotels or we could convert our existing hotels. We like the AC Hotels by Marriott brand. The branded hotel is popular among millennials due to its modern and sleek design, notably in Europe and the United States.
Our aim is to establish a hotel under the AC brand in every state, including Sabah and Sarawak, as it caters to different segments of the market,” he said.
Yeoh said the group would leverage its core business of construction to build AC Hotels costeffectively and efficiently with Marriott International as its partner.
YTL Hotels operates 12 Marriott International hotels in Asia and Europe, such as The Ritz-Carlton, JW Marriott and Autograph Collection, in its portfolio of 36 hospitality assets.
GROWTH IN ASIA PACIFIC
Meanwhile, Smith said Marriott International is close to achieving its target of opening 1,000 hotels in Asia Pacific by the end of next year.
He said the hotel group has opened 800 hotels to date.
“We have 200 more to go and about half will open in China, about one third in India and the rest in countries like South Korea and Japan. China and India are the biggest growth markets for us in Asia Pacific,” said Smith.
He said the operating hotels in Asia Pacific have an average occupancy of 60-70 per cent.
“There is a saying that it is better to be lucky than good. We are in the lucky part of the world. Every economists you talk to say that the biggest market in the world is still Asia Pacific.
“At the group level, we are growing the fastest in Asia Pacific. The MICE (meetings, incentives, conferences and exhibitions) market is still at an infant stage and we predict the business will grow the fastest in Asia Pacific than anywhere else,” said Smith.
Marriott International, based in Maryland in the United States, encompasses a portfolio of more than 7,000 properties in 30 leading hotel brands and in 132 countries and territories.
We have 30 hotels operating in Malaysia today under 14 brands. Everyone is worried we are going through a recession. But we have a pipeline that is robust and we continue to be bullish. CRAIG SMITH, Marriott International Inc president and managing director for Asia Pacific