Seacon Development, owner and operator of Seacon Square shopping and entertainment complex, plans to invest a combined Bt11 billion in two new projects: a five-star hotel in Phuket and a mixed-use complex in Bangkok.

The proposed Bt1-billion pool-villa resort on Mai Khao Beach will be the company's first hotel project.

Work is expected to begin on the 40-unit resort early next year over an area of 24 rai and expected to be completed in October 2008.

Seacon Development's managing director, Tatiya Sosothikul, said hospitality was expected to become the company's second main business in the future.

He said the company was negotiating with hotel-management chains and expected to ink a deal in the third quarter. He added that the resort would focus on drawing clients from both Asia and Europe.

To run the hotel business, Seacon has already established a new entity - Seacon Hotel and Resort Co  - with registered capital of Bt10 million.

He said following on high demand for premium accommodation in post-tsunami Phuket , there was potential for the hotel industry, because of less-intense competition.

Tatiya added that there were few five-star hotels in Phuket and only three pool-villa resorts: the Banyan Tree, with 100 rooms; the Tree Sala, with 40 rooms; and the Sri Phanwa, with 11 rooms.

"In fact, Phuket has the potential for more than a thousand villa-resort rooms, buoyed by demand from international tourists," he said.

The company chose Mai Khao Beach, because it believed the spot had a potential to become a high-end destination but was yet to be fully developed.

The only five-star accommodation there now is the J W Marriott Hotel. The Central Group and Renaissance under the J W Marriott Group are due to follow.

Tatiya estimates the hotel will gain Bt150 million in sales within the first year, rising to Bt500 million in the fifth year, reaching the break-even point within five to eight years.

In addition to developing its own resort, Seacon is on the lookout to buy up high-potential firms in the hospitality indusry. The first in its sights is a pool-villa resort on Koh Samui in Surat Thani.

At the same time it is building the Mai Khao Beach hotel project, the company plans to build Seacon City, a 700,000-square-metre complex in the vicinity of Seacon Square, which is its 500,000-square -metres shopping and entertainment complex on Srinakarin Road in eastern Bangkok.

To finance the project, Seacon will mobilise funds from outside through a proposed Bt10-billion property fund, of which the company will hold one-third.

Seacon City will be a "mixed use" complex, containing condominiums, serviced apartments, a hotel and office space. Work on the condominium project is expected to start first.

However, no decision has been made on the size of each project. The company is awaiting the opening of Suvarnabhumi Airport, because it wants to monitor any change in the local community and assess the likelihood of a mass-transit system being built in the area first.

Nitida Asawanipont

The Nation