Onyx turns focus to serviced apartments

Segment viewed as industry growth driver

Onyx Hospitality Group, formerly known as Amari Hotels and Resorts, is focusing on serviced apartments as part of its plan to expand its service line and become Asia‘s leading hospitality provider by 2018.

The group yesterday launched its first serviced apartment worth 800 million baht, Amari Residences Bangkok. The 128-room property, located on Phetchaburi Road near Bangkok Hospital, was developed by Amari Estates, the group’s development arm.

Onyx yesterday also closed a deal to wholly acquire Hong Kong-based Shama, a serviced-apartment provider. It aims to use Shama’s expertise and networks in helping the group expand its reach in the serviced apartment business in Asia.

Shama manages 13 properties in four cities: seven in Hong Kong, four in Shanghai, one in Dalian and another one to be opened in Bangkok later this year.

The acquisition brought properties under management by Onyx to 32 this year. Of those, 17 are hotels and 15 serviced apartments.

Peter Henley, chief executive of Onyx Hospitality Group, said the takeover helped the group to gain an immediate presence in China, one of the key expansion countries for the group. Other target locations include India, Bali, Vietnam, Cambodia and Australia.”We want to be Asia‘s leading hospitality provider by 2018. Expanding into serviced apartments will help us compete in all ranges of the hospitality experience,” Mr Henley said.

Onyx expects to manage 51 properties by 2018 with a projected investment value of not over 2 billion baht. Half of them will be serviced apartments.

Yuthachai Charanachitta, chief executive and president of Amari Estates, said the group aimed to provide product offerings in all segments.

He sees the hotel market as highly competitive while serviced apartments in Bangkok still have ample room to grow.

The group forecasts demand for serviced apartments in Bangkok at 9,000 units over the next two years.

The company expects its Amari Residences to have a 30% occupancy rate by year-end and 65% next year with foreigners expected to make up about 80-90% of the total occupancy. Room rates range from 2,000 to 4,000 baht per day with sizes starting from 44 square metres.

Initial target clients are those receiving medical services at the nearby hospital, particularly clients from the Middle East and Africa. It plans to target Japanese and Korean visitors in the future.

The group will also manage a serviced apartment in Sukhumvit Soi 2 that is due to be opened in December.

Mr Yuthachai expects serviced apartments will drive the group’s hospitality business.

Onyx, with over 45 years’ experience in the industry, manages hotels, resorts and serviced apartments under the Amari, Ozo and Saffron brands.

Source: http://www.bangkokpost.com/business/economics/201077/onyx-turns-focus-to-serviced-apartments