Thailand's Centara Hotels Moves into Budget Segment

Posted: 08 Mar 2009 | 4:06 pm

Looking to diversify into the highly profitable limited service low cost budget area the Central groups hotel arm Centara have announced they are entering a joint venture arrangement with an international overseas operator. Using a development strategy of diversifying their portfolio with some owned and other pure management contract arrangements the chain is targeting a growth of 20 properties located in key domestic markets.

The last year has seen a phenomenal growth of ACCOR's IBIS brand though out the country and key competitor Holiday Inn Express currently has a number of projects under development. Other international brands such as Carlson's Park Plaza and Hiltons Hampton Inn have been aggressively targeting regional expansion with similar operating models.

Low cost or budget travel brands are on the rise here given the success of such LCC's (low cost airline carriers) AirAsia, Tiger and Jetstar offering no frills services at competitive pricing. Pricing points for IBIS products are in the THB 1,000 - 2,000 baht level and focus on internet based reservations.

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