Cambodiana Investment Pte. Ltd. was
one of the first foreign investors coming
to Cambodia. Can you introduce us the hotel
and its historical background?
Hotel Cambodiana is an investment realized
by a Singaporean company called Cambodiana
Investment Pte. Ltd. The owners of the company,
Mr. Lim Bantoon, Mr. Steven Lek and Mr.
Peter Lek came in 1988 to Cambodia and signed
an agreement with the government to lease
the hotel and the land on which the hotel
is built. That same year, the refurbishing
of the hotel started and it officially opened
its doors at the beginning of 1991. The
lease agreement is for 70 years and the
surface where the hotel stands is 3,5 ha.
The location of the hotel is at the junction
of the four rivers the Upper and Lower Mekong,
the Tonle Sap and the Bassac. When we came,
the structure of the hotel was already built.
We did the decoration, elevators, air conditioning
and so on. The construction of this hotel
was commissioned back in 1968 by King Sihanouk
and formed part of tourism development project
along the river. Next to this hotel, were
also a V.I.P. bungalow hotel and a casino,
which was burned during the war.
We were already fully operational even
before the signing of the Peace Agreement
in October 1991 in Paris. 1991 was a very
difficult year because we didn't have many
guests. When the King himself came to Cambodia
in November 1991, we saw plenty of countries
re-establishing diplomatic relations with
Cambodia and also the delegations of the
UN settling to help develop the country
and all its political activities. Not only
the UN had its offices in our hotel, at
a certain point we achieved to host thirteen
ambassadors because there was nowhere else
to stay. There was no electricity so it
was hard to get a house in conditions. The
hotel is self-sufficient producing its own
electricity, treating its water and importing
its own gas. So 1992 and 1993 were quite
busy years for the hotel.
After the UN personnel left in 1994, occupancy
went down because there was not much economic
growth, in 1996 and begin 1997 although
we saw the construction of two competitors,
the Intercontinental and the Raffles. Then
in July 1997 we were confronted with the
social unrest and also the Asia crisis.
We had a few bad years but we managed to
survive after drastic actions. In 2000 tourists
started to come back. In the year 2001,
we managed to restore some confidence to
the travel agencies to send some tourists
and there was renewed of interest of some
investors to return to the country. It was
at that time that Cambodia joined the ASEAN.
In this context, we saw a substantial increase
on the political activities, especially
within the region. So we started to have
meetings between the ASEAN countries and
with financial institutions like the IMF,
Asian Development Bank, World Bank and all
the donors to Cambodia.
Currently we are being hit by the war in
the Middle East. Most of our European reservations
have cancelled because of this conflict.
At the same time we got the double blow
of the appearance of SARS, which is quite
bad for all the Asian countries. Our main
guests come from French and Japanese tourism
and the Chinese (PRC) and Singaporean businessmen.
Due to the war and the SARS a lot of them
cancelled. Having said that, April is also
the beginning of the low season for Cambodia,
so it is quite normal to experience a slow
down in occupancy.
We are also worried about this year due
to the upcoming elections in July 2003.
Generally, when elections take place, there
is a slow down in occupancy rates, as people
want to wait for the result before taking
action. Right now it is a wait and see situation.
Can you give us some key figures of
the hotel?
We have 300 rooms including 24 suites.
There are four restaurants: one Italian,
one French, one Asian, a coffee shop and
a bar. We have banqueting facilities for
600 people, three smaller meeting rooms
for smaller size conferences. There is also
an executive floor and business center designed
for business travelers, meeting their specific
needs. There is also a swimming pool, which
is a luxury here in Phnom Penh; two tennis
courts, a gymnasium and a spa center. Next
to that there is also 20.000 sq feet of
office space. Just to name a few of the
companies present in our hotel there is
Sumitomo, Mistui, Maersk, Alcatel and the
Franco-Cambodian Chamber of Commerce.
We have 460 employees, 430 full time, casual
employees are hired for special activities
like banquets. What concerns occupancy,
the average for 2001 was 65% and for 2002
it went down to 55%. This can be explained
mostly because of the effect of the Open
Sky Policy of the government. Before the
Open Sky Policy, all flights were coming
to Phnom Penh for one night and then went
on to Siem Reap. Currently 65% of leisure
inbound trips go directly to Siem Reap,
this explains our loss of occupancy.
What concerns turn over, our room rates
decreased tremendously from 1997 to 2000
but then went back again. Presently our
average room rate is between 62 and 65 USD.
In 1997 we were above the 100 USD.
When we see the evolution of the Cambodiana
throughout the years, Ambassadors, UN officials
and delegations from several organizations
along with businessmen have been your main
clients. Is your strategy exclusively directed
toward business travelers?
We changed our strategy over the last two
years. What we are doing now is to focus
on all conferences. It is a very interesting
market segment for us because they not only
consume rooms, but also the rest of the
facilities of the hotel, which is what we
need. So we are looking at the trend of
the last two years and this is a market
that is developing quite fast. As you said
it's connected with the government, embassies
and the UN, the EU and all these organizations,
which are here to help politically and financially
the country. There are more and more meetings
and trainings organized by these organizations
here in Phnom Penh, so we are reinvesting
in our facilities keeping in mind the needs
of these groups.
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We focus on business because as long as
the Open Sky Policy is in place and as long
as the country is not completely open; with
new destinations where we can offer various
packages for tourists to stay three, four,
five nights within Cambodia, tourists may
carry on to bypass Phnom Penh. Indeed, the
strategy is to invest in our rooms and the
conferences and banquet facilities to attract
the business travelers. But of course will
encourage the tourist to come to Cambodia.
Do you have any specific project to
attract those tourists towards Phnom Penh
or to invest yourself in other sites of
Cambodia?
As a single company we cannot sway markets
around. But we are working closely with
the Ministry of Tourism to develop more
awareness about tourism in Cambodia and
specifically to Phnom Penh. On that matter
I really have to take my hat off to the
Minister of Tourism and his team because
they have done a very good job in the last
two years. They demonstrated it especially
during the ASEAN Tourism Forum last January.
It was a fantastic organization, some of
my guests said it was the best ATF they
have attended. Furthermore they have launched
many brochures. The Minister is very active
and is extremely good at Public Relations.
We are joining them to help in as many things
as we can. With this in mind we have created
the Phnom Penh Hotel Association and through
the association we try to work closer with
the travel agencies and the airlines to
get packages together and new ideas to promote
Phnom Penh as a destination other than Siem
Reap. We are helping as well in different
forums between the public and private sectors
to raise issues and proposals to promote
and develop more the interests for tourism
to Phnom Penh. It has started to pay off.
The more we expose Cambodia through activities
like the ASEAN Tourism Forum, the "Visit
Cambodia Year" and campaigns in the
embassies who transmit information about
the country, the more Cambodia will be in
the spotlight.
There are not many new destinations worldwide,
as soon as Thailand and Vietnam get saturated
and markets like Myanmar keep being politically
uncertain, Cambodia will remain as the new
venue. The view of the Minister of Tourism
to achieve the goal of 1 million visitors
is achievable. If you realize that Singapore
is doing over 7 million tourists a year
and Thailand over 10 million, the goal of
the Minister is realistic. Keep in mind
that these one million visitors can be achieved
only with Siem Reap and a little bit in
Phnom Penh. There is still a huge potential
of development for the whole country.
Currently your company manages the hotel.
As you said earlier, you used to have a
managing contract with Sofitel-Accor. Are
you planning in the near future to get back
to one of those managing contract with an
international chain or you want to keep
the formula you are using now?
We are always open to the two options.
As an investor, I am always looking into
how to get the best return and the best
value of my property and my investment.
It's a question of making the right decision
at the right time. Today, our decision is
to manage the hotel ourselves; we have the
expertise in management and a long term
service staff, most of them have been here
since the opening. We have, I believe, a
very good understanding of the market and
what is Cambodia. Right now it's not the
proper time to give the toy to somebody
else to play with.
Can you tell us more about your career
path, your experience in Cambodia and your
greatest satisfaction while working in this
country?
I have a vacational training certificate
at the Hotel Management School in Strasbourg.
I started working in Paris for four years
with the group Accor. Then I went one year
to Abu Dhabi, to come back to Europe, in
London, for four years. In 1988, I arrived
to Asia where I worked in Singapore for
one year, then in China for two years. From
there I went for the first time to Cambodia.
I moved on again to South Korea. In 1995,
I opened my own business in Singapore as
a consultant for hotel management. At the
same time I invested in the company owing
the hotel Cambodiana.
My greatest satisfaction in Cambodia has
been to see the development of my staff.
Six months after my arrival in 1991, I had
to change the uniforms of my staff because
they were much more healthy than when they
started. It is indeed a great satisfaction
to have given jobs, hope and something to
look up to. Most of my initial staff is
still here, they have their own families
and they have also evolved professionally.
Furthermore plenty of my managing staff
is Cambodian. It is fantastic to have seen
their evolution.
As a businessman having private investments
in the country, what would be the final
message you would like to transmit to potential
investors interested in Cambodia?
Cambodia is a place you either love or
you don't. If you want to invest here, you
must love it. Why? Because it is a difficult
place to work in. To manage a company here,
you must consider yourself as a captain;
you are in your own boat and even if there
is no wind, you have to make sure you bring
your boat forward. If there is a storm you
have to keep your boat floating. This is
why I compare a businessman here to a captain
of a boat. We all want to make money, but
you have to understand that there are some
aspects of the Cambodian economy that are
still in the stage of infancy, such as laws;
technical assistance; training, etc. Due
to this difficulty you have to make sure
you love the country, otherwise it will
be difficult for you to make business here.
There are still a lot of opportunities;
it is just a question of how much guts do
you have and you also need to have a special
profile to come over here.
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