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Hotel chain wants 10 more branches in three years

Wednesday, June 17, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]


Best Western International, Inc. recently took over management of the 50-room Boracay Tropics resort in one of the country’s top tourist spots.

AMERICAN HOTEL operator Best Western International, Inc. wants to become the largest international hotel chain in the country by 2012 by adding 10 more hotels to the existing five, executives said yesterday.

Rashane Sala-Ngarm, international development manager for Asia of Best Western, said talks with four potential partners are already in the advanced stages.

Mr. Sala-Ngarm said that of the 10 hotels to be established here, up to three would carry the high-end Best Western Premier brand, while the rest would be middle-market establishments.

The average investment for such four-star establishments is about P4 million per room, but he said the number of rooms may vary.

Cyndy Tan Jarabata, president of hospitality consultancy firm Tajara Leisure and Best Western’s Philippine envoy, said the hotel chain also plans to develop properties in cities and tourist destinations where there is strong demand for accommodations.

These are Quezon City, Mandaluyong, Mactan, Davao, Baguio, Tagaytay, Clark, Subic, Palawan, and Bohol, she said.

The firm has three hotels in Metro Manila and one in Boracay. It is set to open another hotel in Cebu.

Glenn de Souza, Best Western vice-president for international operations, said in a statement that the hotel chain plans to put its stamp in the Philippines by either converting existing deluxe properties or constructing new hotels.

Ms. Jarabata recalled that in 2007, Best Western initially planned to add just five more hotels in the Philippines, but increased its target after three applications to acquire the brand by franchise were approved within a year. The group has already turned down several proposals.

"We really want to get strong partners for our mid-range brand ... Investors [are very interested] in Best Western because of brand value and higher return on investments," she said.

Ms. Jarabata said Best Western’s mid-end hotels also offer faster returns because most tourists, who want the best value for their money, now belong to this bracket.

The firm scheduled a dinner with prospective partners last night.

Ms. Jarabata said local investors can also capitalize from the hotel chain’s wide international network that presents cross selling opportunities.

Best Western is the world’s largest hotel chain with more than 4,000 independently operated and owned hotels.

The Philippine expansion is in line with the group’s ambitious expansion plan for Asia, where it aims to have over 200 hotels by next year.

Last year, the number of tourists who went to the Philippines went up slightly to 3.14 million. But the hotel occupancy rate went down to 69.8% from 73.1% in 2007. — Don Gil K. Carreon

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