Wednesday, July 18, 2012

Tune Hotels to open in eight hotels in Indonesia by 2013

Red Planet Hotels Limited, a partner of, is set to open eight budget hotels across the country by 2013 to capture growing market demand.

Red Planet CEO Timothy Hansing said the company had invested US$90 million in Indonesia alone to commit to entering the market.

“We see the Indonesian market is growing very rapidly at the moment. When the economy grows, people are doing business, traveling a lot, and certainly they need accommodations. These are the rapid demands of the economy that we would like to capture,” Hansing told The Jakarta Post.

He said the company had recently opened its first hotel on Jl. KH Samanhudi, Pasar Baru, Central Jakarta on July 12, which had 168 rooms.

“We are very glad because its occupancy rate could reach 100 percent during the opening,” Hansing said.

The company’s next hotel opening will be in Pekanbaru, Riau, on Dec. 10, which will have 143 rooms.

Six more hotels are slated for next year, in Makassar, South Sulawesi; Surakarta, Central Java; Surabaya, East Java; Tangerang, Banten; Bekasi, West Java; and Palembang, South Sumatra.

He said that he was not afraid of competing with existing chain players that had expanded their businesses in Indonesia, such as Accor International, Aston, and the Kompas Group’s Santika Hotel and Amaris Hotel, because the demand remained strong.

As a comparison, a standard double room in an Amaris Hotel in Juanda in Central Jakarta would cost the guest around Rp 370,000 (US$39.22) per night, including a free breakfast for two people.

A double room in Tune Hotel in Pasar Baru, Central Jakarta, would cost two guests a basic rate of Rp 150,000 without any amenities. Guests can choose to add amenities individually or by package. As an example, a package of 12-hour air conditioning, 24-hour TV and WiFi, towels and toiletries will cost Rp 99,000 per night, making the total price about Rp 250,000. The basic price can vary, however. It can be as much as Rp 258,000 or as little as Rp 55,000.

Tunes Hotels are strongly associated with the Malaysian-based budget airline AirAsia, which has built a strong presence among budget travelers, not only in Indonesia, but also in Asia and Europe. Hansing said the AirAsia brand gave Red Planet a competitive advantage.

As of today, Red Planet Hotels Limited has invested a 16.05 percent stake in the rapidly expanding Tune Hotels operation as both companies seek to grow the booming business of a low-cost hotel brand.

The largest shareholder in Tune Hotels is Tony Fernandes, the founder of AirAsia.

Red Planet now has $180 million worth of hotel projects boasting 3,191 rooms that either operate or are under construction in Asia.(Jakarta Post)

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