Development of new hotels seen as boost to Kuala Lumpur
EVERY year, almost a quarter of hotel guests in Malaysia stay in Kuala Lumpur, making it a desirable place to build a hotel.
There is no lack of choices for places to stay in the city ranging from budget hostels all the way to international brands and upscale hotels including the Mandarin Oriental Kuala Lumpur, Grand Hyatt Kuala Lumpur, Hilton Kuala Lumpur and JW Marriott Kuala Lumpur, to name a few.
A drive around the city centre will also reveal various new hotel developments as well as redevelopments taking place in several prime locations, including the Bukit Bintang-KLCC area.
Many of these construction sites carry proud signage that herald the arrival of more well-known brands such as Four Seasons Place, St Regis Kuala Lumpur, W Kuala Lumpur and even the first-in-the-world Harrods Hotel.
Four Seasons Place is to reach 65 storeys and will feature the highest residential swimming pool at over 330m above ground level.
There is also an upcoming Sheraton property in Puchong and another by Le Meridien in Putrajaya.
DBKL Planning deputy director Datuk Mahadi Che Ngah said the trend was an indication of the city’s attractiveness as a destination.
“Kuala Lumpur has not reached saturation stage for hotels and, as such, we do not have any specific town planning restrictions. However, there are many investors and developers who come to us for advise on suitability but our rule of thumb is to approve applications that meet all the requirements,” he said.
One exception is that hotels are not allowed on ‘local’ commercial lots that are meant for small businesses catering to the needs of the immediate community.
He also said that one of the hottest spots for hotel development was the Bukit Bintang area while the most popular type of guest accommodation to build were budget hotels.
“In Changkat Bukit Bintang, the sheer amount of applications we have received, mostly to convert old buildings into hotels, necessitated the setting up of special guidelines to meet minimum requirements. If we had not done it, most, if not all of the applications would not have been able to meet the regular requirements and get approval,” he said, adding that the guidelines were only applicable in this area.
Mahadi said DBKL’s target was to achieve 107 million sq m of commercial space, including hotel space, by 2020.
“Right now, we have 41 million sq m, which is a combination of existing space and development orders issued for commercial space,” he said.
New developments are also seen by DBKL as projects that can bring life to a city.
“Our vision is to create a vibrant, prosperous and attractive city. Development is merely one element that contributes to the creation of such an environment,” Mahadi said.
He explained that new developments could figuratively and literally brighten up a city.
“A new development brings about renewed activities to the area, apart from generating new work opportunities. New buildings also showcase current designs and architectural trends, all of which have the potential to create new icons,” he said.
The Tourism Malaysia website states that the average occupancy rate for hotels in Kuala Lumpur over the last few years has been between 63% to 70%.
Malaysian Association of Hotels chairman Sam Cheah said that additional hotels would cause a loss of business if the existing statistics show less than 70% average occupancy.
“We are doing alright but based on early estimations for the first half of this year, the average occupancy seems closer to 60%. More data is needed for a better reflection of the current situation as a whole,” he said.
He said that Kuala Lumpur hotel guests were a mix of domestic and international travellers while the big markets were in the corporate and MICE sectors, as well as tourists.
“There are also more domestic travellers when the economy is strong. Having said that, each hotel positions itself differently and has its own target market,” he said, adding that most travellers typically mix some leisure with business during their hotel stays.
Cheah said the industry was currently working on getting more tourists with higher spending power.
“Branded and upscale hotels will attract such people to a certain extent but usually people will choose a destination first and then only check out the hotels for one that suits their budget and needs,” he said.
He also said that the term ‘spending power’ was quite subjective.
“Many think those who stay in budget accommodations do not spend a lot. What they don’t realise is that often these people have long stays which can bring total spending to a considerable sum,” Cheah said.
He also said that one of the most important things the authorities could do for the industry was to carry out proper studies.
“Good data can help to build a well-structured city as well as gauge better the effectiveness of many projects and events. Projects that hit the nail on the head can greatly increase room demand,” he said.
For now, it does seem that investors are comfortable enough to put their stakes on the city and country’s future as seen in a report quoting Qatar Holding vice-chairman Dr Hussain Ali Al-Abdulla.
Qatar Holding, in collaboration with developer Jerantas Sdn Bhd, is behind the Harrods Hotel development, located on a piece of land between Jalan Raja Chulan and Jalan Conlay.
An artist’s impression of the new Hotel Equatorial Kuala Lumpur, which is expected to be completed in about two years.