BANGKOK 21 July 2020: Destination Capital, Bangkok-based
private equity real estate investment and asset management company, is set to
join forces with its capital partners to acquire hotel assets in the Asia
It will start with Thailand employing a strategy of acquiring
strategic hotel assets and then adding value through renovation, asset
management and rebranding typically with a global hotel brand to boost
financial returns and revitalize the hospitality sector.
Destination Capital chief executive, James Kaplan, shared
that Destination Capital will focus on prime-located freehold hotels and
resorts of approximately 200 rooms located in key urban and resort locations.
Thailand is awash with empty hotel rooms, and most hotels are now in a financially distressed state as travel arrivals plummeted since March due to the ban on commercial international flights that remains in place possibly until September. Tourist arrivals are likely to fall to around 8 million this year compared with 2019 that generated 39.8 million arrivals.
Millions of people are unemployed, and thousands of hotel
rooms are now shuttered which has prompted the immediate need for fresh
injections of capital necessary for hotels to re-employ and re-open as well as
sustain operations during what most industry experts agree will be a more
prolonged recovery cycle until a vaccine is available and air traffic returns
with regularly scheduled service.
Although the hospitality industry will be slow to recover as
a result of the current situation, historically, Thailand rebounds from crisis
to become more resilient.
“We believe a similar rebound story will be true with a full
recovery in 3-4 years,” said Kaplan. “We will deploy our resources to source
and acquire hotels which present a turnaround story during this period of
Destination Capital (DC) was recently formed as an
investment fund to partner with private equity and institutional Funds to
source hotel acquisition opportunities and asset management in the Asia Pacific
region with an emphasis on Thailand.