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Far East to double portfolio with overseas expansion
Gracia Chiang, reporting from ITB Asia, October 18, 2012
 

WITH a successful REIT listing now in the bag, Singaporean hotel group Far East Hospitality's (FEH) plan is to double its size over the next five years, which will include exporting some of its brands to South-east Asia and Australia.

 

Operating eight hotels and nine serviced residences in Singapore and one serviced residence in Malaysia, the “internal target” is to achieve 17 hotels and 17 serviced residences by 2017, said FEH CEO, Arthur Kiong.

 

He told TTG Asia e-Daily that besides two confirmed hotels that will be coming online next year – the 229-room Peranakan-inspired East Village Hotel at Marine Parade and the boutique 37-room The Amoy Hotel, built within shophouses at Far East Square and its lobby being the Fuk Tak Chi Museum – at least four more properties under development by parent company Far East Organization (FEO) were likely to be managed by his team.

 

“FEO already has a pipeline of hotel projects that it intends to open and guess who is going to manage them...It’s pretty obvious that if FEO has a hotel, is it going to give that to somebody else and not its own?” said Kiong, who is also FEO’s executive director.

 

Among the stable of FEO’s local projects are Oasia Downtown Hotel (2014), The Outpost Hotel (2016) and Oasia West Residences (2016). The first will be a 318-room business hotel in the Tanjong Pagar area with additional small office/home office units; the second a 292-key business hotel with a strong heritage theme at Far East Square; and the third, 120 one-bedroom apartments that will function as hotel residences catering to individual business travellers from shipping industries, as well as nearby science and technology hubs.

 

Both The Amoy and The Outpost will join the newly created Far East Collection due to their architectural attributes and unique locations; their sister properties being The Elizabeth Hotel, Orchard Parade Hotel and Sri Tiara residences.

 

Despite these stand-alone properties, Kiong said FEH would continue its focus on mid-tier and upscale properties, while ensuring brand discipline. It currently has three brands: three-and-a-half to four-star Village, primarily driven by the cultural appeal of a particular enclave; four to four-and-a-half-star Oasia, serving a business clientele; and four-and-a-half to five-star Quincy, with an all-inclusive boutique concept.

 

Overseas expansion is also on the cards. “We have a lot of prospects knocking at our door because we have raised our profile with our REIT, and we also leverage a lot of FEO’s expertise and business acumen,” said Kiong.

 

An Oasia Kuala Lumpur is slated to open by 2014, while there are talks for a Quincy in Bali and Phuket, and a Village in Bintan, revealed Kiong. He added that FEH was also looking at bringing its brands to other strategic locations in Indonesia, as well as Myanmar and Vietnam.

 

Kiong explained that because the above were high-growth markets, FEH was also looking to balance its portfolio with low-risk deals in Perth, Sydney and Melbourne.

 

“We will have a significant commitment in Australia to establish a large presence because you can’t do it without scale. It would be either an acquisition or partnership,” said Kiong.

 

He explained that while China and India were hot markets, they were slightly too far away for FEH to leverage its home base in Singapore, while there were already plenty of profitable opportunities in its own backyard.

 

Kiong said that currently 50 per cent of FEH’s bookings come from travel consultants, a ratio it is intending to keep despite having recently relaunched its own website for direct sales. Overall volumes, however, will increase phenomenally given its planned growth.

 
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