Bangkok, June 28, 2023 – Thailand based ONYX Hospitality Group is pleased to share that its Senior Vice President and Group Head of Finance, Mr. Wuthivet Vetchabutsakorn featured as a guest speaker at the recent South East Asia Hotel Investors Summit (SEAHIS) 2023. The event tool place in Bangkok on the 26th and 27th June 2023.
During his presentation, Mr. Vetchabutsakorn addressed the topic of accessing bank finance and alternative models for securing debt finance in a post-COVID world. His insights at the SEAHIS 2023 provided valuable knowledge and guidance to industry stakeholders, ensuring they remain informed and well-equipped to navigate the evolving landscape of hotel finance. He made several key remarks during the session:
“With the hospitality industry navigating the challenges brought about by the pandemic, ONYX Hospitality Group has been at the forefront of managing liquidity and exploring innovative financial strategies to support the company's growth plans.”
“As a leading medium-sized hotel company in South East Asia, ONYX Hospitality Group has cultivated strong relationships with banks in Thailand, thanks to its well-established brands and rich company heritage. Even amidst the global pandemic, the company successfully secured financial support from several commercial banks through short- and long-term loans, as well as collaborations with financial institutions for loan reprofiles, demonstrating its resilience and determination to overcome adversity.”
ONYX Hospitality Group prides itself on its credibility and solid relationships with financial institutions. The company maintains regular and transparent communication with banks, providing honest insights into business challenges and presenting contingency plans to address them. By proactively addressing potential concerns, ONYX Hospitality Group has earned the trust and support of its financial partners. The company also diligently prepares cash flow projections to assess liquidity risks and demonstrate its commitment to loan pre-payments whenever feasible.
Vetchabutsakorn went on to say:
“Whilst most Thai financial institutions continue to base lending decisions on project cash flows, collateral such as assets, buildings, lands, shareholder guarantees, and shares are also considered essential security measures. In the post-COVID era, banks are placing a greater emphasis on project quality and the brand affiliation of hotel owners. Collateral requirements remain a crucial aspect of loan agreements, with Loan-to-Value ratios typically ranging from 60% to 70%.”
“Notably, the reputation of hotel brands plays a significant role in Thailand's lending environment. Banks rely on extensive databases and historical performance records, which consistently demonstrate the superior performance of branded properties compared to non-branded assets.”
Addressing a common challenge in Southeast Asia, Mr. Vetchabutsakorn highlighted the issue of amortization schedules, with term loans typically spanning 7 to 10 years. To facilitate hotel performance and minimize financial strain, loans often required bullet payments at the end of the term or refinancing options. In certain high-risk projects, banks have recently introduced cash sweep arrangements, incentivizing hotel project finance by sharing a percentage of revenues exceeding the target with the banks.
“The recent trend of property developers diversifying into hotel assets reflects a desire to access recurring income streams rather than solely relying on built and sold property types. Additionally, the region has seen multiple joint venture projects with foreign investors, particularly in Bangkok and Phuket, indicating a positive investment climate.”
“Looking ahead, as interest rates stabilize, a more favorable lending environment is anticipated, potentially as early as mid-next 2024. The recovery of tourism to pre-COVID levels, coupled with improved airlift capacity exceeding 80% of pre-pandemic levels, is expected to contribute to this positive outlook.”
ONYX Hospitality Group currently operates 44 properties, out of which XX are owned. In 2023, the company looks forward to launching Amari Raaya Maldives, the most anticipated new openeing in the Indian Ocean in 2023.
###
About ONYX Hospitality Group
About ONYX ONYX Hospitality Group operates four diverse yet complementary brands – Saffron, Amari, Shama and OZO - each catering to the distinctive requirements of today’s business and leisure travellers. The group reaches beyond its Thai roots to offer innovative management solutions across the Indian Ocean, Arabian Gulf and Asia-Pacific regions. Visit www.onyx-hospitality.com.
For more information about this release please contact:
Hannah Filer – PR Consultant Email: hannah@atwtravelmarketing.com
For high-resolution photography, please visit our press centre or contact us:
Press Centre: http://press.onyx-hospitality.com/en-us/
Email: onyx.pr@onyx-hospitality.com
