Banyan Tree launches serviced apartment brand

It is developing 5 properties under the Cassia brand.

LUXURY hospitality firm Banyan Tree Hotels & Resorts has launched a new brand of serviced apartments, in its first foray into the extended-stay segment. The firm will develop five properties under the Cassia brand - in Phuket in Thailand, Bintan in Indonesia, Beruwala in Sri Lanka, the Gold Coast in Australia, and Lijiang in China - in conjunction with Banyan Tree Group's 20th anniversary.

It will offer one- and two-bedroom units - ranging from 35 sq m to 55 sq m - costing about $250,000 on average, said Banyan Tree Group executive chairman Ho Kwon Ping yesterday.

Mr Ho said the brand was aimed at a growing pool of investors from the middle class "that can decide to get a second home on a whim".

"Second homes used to be the domain of the ultra-rich, during the last 50 years or so. Now, they are more affordable for normal people, especially if they can get income from it and sell it later on," he added.

Each property will have an average development cost of $50 million, and will have about 200 fully furnished units managed by Banyan Tree.

Owners who buy the units for investment have the option of staying there for 30 days in a year, but with blackout periods during which the units will be leased out, said a Banyan Tree spokesman. Those preferring to hold the unit as a holiday home will have it for up to 90 days of complimentary use, with no blackout periods.

Gross rental yields are expected to be 6 to 7 per cent. But unlike most serviced apartments, there will be no minimum stay period.

The property in Bintan is 45 per cent sold. About 70 per cent of the Phuket project has been snapped up, and will be the first to open next year. Unit rates have not been fixed yet, said Banyan Tree.

Seven more projects are in the pipeline, it added: in Brisbane, New York, Seychelles, Chiang Mai, Bangkok and Lang Co, Vietnam. It also has plans in place to grow its portfolio to 66 hotels and resorts and 117 spas in 33 countries in the next three years.

"The rest of the hospitality sector has seen a lot of excitement and innovation, and even cheaper, smaller, three-star hotels can be hip. But serviced apartments are an under-innovated sector," said Mr Ho. "So we are signalling our entry into this sector, and we intend to shake it up."

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Property Launches & Investments

Banyan Tree launches serviced apartment brand

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