Wyndham Group, the largest hotel company in the world, is starting operations in Singapore and will be managing two new hotels in Balestier Road.
This is a joint venture (JV) between Wyndham Group and local property developers Superbowl and Hiap Hoe Holdings. This is also the JV’s initial attempt into the hospitality sector.
The busy area of Balestier Road is fast turning into a home to several hotels. Eventually, there will be around 10 hotels in the area, but Wyndham still sees a demand for its mid-scale hotels. Due to its proximity to nearby hospitals, they will cater primarily to medical tourists.
“Singapore is a critical market place in Asia. It is a showcase market place. It is where every hotel company wants to be, and there is certainly a shortage of room inventory in the three and four-star market place for international brands,” said Thomas Monahan, Executive Vice President for International Development at Wyndham Group.
“Our brands are a perfect fit for the market place, and they will help us grow in the Asia Pacific region. If you look at the room inventory, most of it exists in the upscale (segment) and so these two properties will be positioned in the midscale, three and four-star, where there is a lack of inventory in that market place.”
Wyndham Group plans to use Singapore as a base to build up its presence in Asia. The two new hotels will have about 400 rooms each and hotels will operate under the Days Inn and Ramada brands.
The two hotels will be separated by a public park, which is being developed as part of a government condition attached with the development of the area. Besides the hotels, there will also be an adjacent office block and an integrated hub for entertainment and dining.
This is the first time that Super Bowl and Hiap Hoe are venturing into the hospitality business. It is part of the strategy of the duo to seek for more steady growth.
“The hotel will give us a very good recurring income, whereas for property development, you will be more dependent on the property cycle,” said Teo Ho Beng, Managing Director of Hiap Hoe Group.
“Our location is near to the medical facilities that are coming up in this area, and we will be able to cater to some of this outpatient requirement that comes here for consultation.”
The overall cost of the development is around S$300 million. Both hotels are expected to open in 2014.