Sri Lanka to build two luxury hotels in Katunayake Airport

Sri Lanka to build two luxury hotels in Katunayake Airport

Sri Lanka has moved ahead with plans to construct and operate two, star class hotels at the Katunayake International Airport, Colombo. The plans were first announced at the cabinet meeting held on 10th May 2016. The hotels were to be constructed on a lease of 40 years on the land belonging to the Airport and Aviation Services Company of Sri Lanka.
Malaysian Company ECM Libra Financial Group Berhad and Singapore based TP Real Estate Holdings Private Ltd have been recommended by the procurement committee appointed by the cabinet. The minister of Transport, Nimal Siripala de Silva has further commented this decision was taken due to accommodate increasing passenger requirements.
According to the Request for Proposals (RFP) published by the Airport and Aviation Services (Sri Lanka) Ltd (AASL), the hotels shall be constructed and operated for the purposes of fulfilling the requirements of Airline crew members, Airline passenger, off loaded and transit passengers and any type of customer. This is line with the push to developing Sri Lanka as a transit hub.
The land which had been leased in the extent 1.2771 Ha, is the sole property of AASL and is located opposite the Airport premises in close proximity. The RFP also lists a set of minimum conditions of 100 well-appointed rooms, recreation and sport facilities and any and other relevant facilities that match or is in line with a 4-star hotel consistent with Sri Lanka Tourism Regulations Guidelines and the Section 49(1) of the Tourism act of No.38 of 2005.
Sri Lankan civil aviation has a proud history dating back 1930’s with a first construction of an aerodrome in Ratmalana. It has grown continuously albeit somewhat slower during its first years. The growth expanded during the world war II period as Sri Lanka then known as Ceylon was under colonial rule. However, soon after the war ended Air Ceylon, first national career commenced international flights to various destinations. A major turning point in the aviation history of Sri Lanka was the period from 1998 – 2008 in which the Sri Lankan Airlines operated in a partial privatization with Emirates Group which had a significant and a positive impact for growth of the Industry. Today, Sri Lanka serves over 45 destination across the world.
Established in 1983, AASL is a fully government owned company with statutory powers to oversee the development, maintenance, administration and service delivery of airports in Sri Lanka. It has taken a very prominent role of the Government Infrastructure development strategy in recent times due to priority placed on tourism and aviation industry.
The Sri Lankan aviation industry is facing unprecedented demands as it has far outgrown the facilities it can provide and the government has taken a large number of initiatives which include the construction of the two new hotels.
Katunayake Airport is the main airport of Sri Lanka which is situated 35 kilometers north of Colombo. It currently operates with two terminals and an additional terminal expected to be constructed by 2019. The Terminal 2 is built under a concessionary loan between AASL and Japan International Cooperation Agency (JICA). The upper max capacity of Katunayake Airport is 6 Million passengers per annum. However, in the year 2015 it handled over 8.5 million passengers which has resulted in congestions especially in peak hours.
The statistics published by the Research & International Relations Division of the Sri Lanka Tourism Development Authority lists the number of tourist arrival for the year 2015 at 1.798,390 and for the month of January 2016, 194,280. The report also shows that the peak arrivals are in the month of January and December and the month of January of 2016 has attained a number of 194,280 compared to the January 2015 number of 156,246, an increase of over 20%. These numbers have continued to grow totaling a number of 2,050,832 in the year 2016 and already hitting a number of 604,953 for the year 2017.
The government aims to increase the capacity to handle 15 million passengers per annum which signals the growth the industry is aiming to attain. To service this expected demand as well as to acclimatize to modern needs the Airport has also recently renovated its runway as well as plans to construct a second runway to support the Airbus 380. Additional projects in the pipeline include rapid exit to Colombo Katunyake Highway, major infrastructure including shopping and cargo complex as well additional parking capabilities.
The initiative to build two, star class hotels will serve the Airport in being able to provide and sustain a better level of service especially with regard to being a transit hub. One of the key drawbacks which hinders the ability of the Katunayake Airport to provide Transit services is the lack of nearby hotels which can provide services to transit passengers and related crew. Currently, the hotel “Serenediva: which is operated by Sri Lanka catering is the only hotel acting as a transit hotel. However, the capacity is severely restricted as it has only 24 rooms to serve at any given time.
More large and established hotels only operate further away from the airport in the capital of Colombo and this is a hindrance to the transit passengers and crew both in terms of time and money. This can be easily solved in large part with the addition of new hotels in close proximity to the airport and with the additional development of highway access and improvements in other transport modes likely to serve a reduction of costs in both money and time in access to Colombo.

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Article Code : VBS/AT/26042017/Z-1

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