Thai, Myanmar Hotel Operators Sign MOU for $63 Million Project
By Danny Fenster 13 May 2019
YANGON—Myanmar-owned KMA Hotel Group has signed a Memorandum of Understanding (MOU) with one of Thailand’s largest hotel and resort operators, the company has announced, to partner on a US$63 million (96.86 trillion kyat) investment in several new and existing hotels throughout Myanmar.
Centara Hotel and Resort, a subsidiary of Thai conglomerate Central Group of Companies, currently operates in several ASEAN markets, including Thailand, Vietnam and Indonesia; the MOU marks the brand’s first project in Myanmar.
“Our partnership with KMA Hotels represents a significant milestone for Centara,” Centara CEO Thirayuth Chirathivat said in a prepared statement. “It gives us the opportunity to establish a significant presence for Centara in a country with huge potential for tourism development.”
KMA Group, or the Kaung Myanmar Association Group of Companies, is owned by Myanmar national U Khin Maung Aye. Other divisions of the conglomerate operate in construction, real estate, agriculture, mining and import-export businesses. U Khin Maung Aye is also the chairman of Co-operative Bank Ltd., or CB Bank, one of Myanmar’s largest banks.
The MOU covers six separate projects: the renovation and reopening of three existing KMA-owned hotels and the construction and operation of three brand new hotels, all operating under either the upscale Centara or upper upscale Centara Boutique Collection brand.
Three existing KMA hotels in Inle, Naypyitaw and Taungoo will be renovated and reopened with the new branding, and three entirely new hotels will be developed in Bagan and Than Daung, according to a KMA spokesperson. The first to open, Centara Paradise Inle Lake Resort & Spa, is expected to open its doors in the fourth quarter of this year.
Management agreements for the hotels will be signed in Bangkok and in Yangon in June of this year. They expect the hotels to employ about 1,000 in staff.
“We are delighted that Centara will be bringing their management expertise and strong brand to six of Myanmar’s most popular destinations,” said U Kaung Htet Tun, managing director of KMA Group. “Centara’s presence here represents a step forward for the hotel and tourism industries.”
According to the Ministry of Hotels and Tourism, Myanmar received 3.55 million foreign tourists last year, a 3.15-percent increase from the year before, though net earnings from tourism likely dipped as tourism shifted from Western to Asian markets in the wake of political violence in Rakhine State; spending patterns and lengths of stay vary between the two markets.
In 2018, visitors from China increased by 38 percent, accounting for the largest proportion of tourists that year. Officials attributed the rise to the issuing of visas-on-arrival to Chinese passport holders. On Oct. 1 of that year, the government launched a one-year pilot program that grants visa exemptions to travelers from Japan, South Korea, Macao and Hong Kong.
According to the Ministry of Hotels & Tourism, there was an estimated $4.3 billion invested in hotels and commercial complexes, 60 percent of which came from Singapore.
The Ministry of Hotels and Tourism expects 4.5 million visitors this year and an annual growth rate of 8.5 percent annually through 2025.
Centara currently operates 70 hotels and resorts throughout Asia and the Middle East and has set a goal of doubling that number by 2022.
KMA Hotels, a division of KMA Group, is a national hotel chain founded in October of 2007. They currently operate eight resorts, hotels and inns throughout Myanmar.
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