Property giant Ayala Land’s homegrown hospitality brand Seda seeks to cement its position as the country’s largest hotel chain by spending as much as P10 billion to open 1,405 new rooms in five sites by 2020.
This will expand Seda’s nationwide footprint to 3,268 rooms in 11 locations by 2020 as the fast-growing brand seeks to ride on booming business, leisure and MICE (meetings, incentives, conferences and exhibition) markets, Seda group director of sales and marketing Melissa Carlos said in a briefing yesterday.
Since Seda’s debut in the local hospitality space in 2012, it has built a portfolio of 1,863 rooms in nine locations that are mostly considered “underserved” areas. The brand enjoys a high guest return rate of 42 percent, Carlos said.
“Following our accomplishments in these cities, we are now completing plans to further penetrate major destinations like BGC, Cebu and soon, Makati with an additional 1,405 rooms,” she said.
Andrea Mastellone, Seda’s Italian senior group general manager, estimated that the expansion program in these five properties would cost at least P8 billion to as much as P10 billion. Even with the current portfolio, he said Seda was already the biggest hospitality brand in the country.
This will involve the expansion of accommodations and facilities in two mature locations, BGC and Nuvali, which are both experiencing high occupancy rates exceeding 80 percent. By building a second tower in each of these two locations, Seda will open up additional rooms of 342 and 206, respectively. The new wing in BGC is expected to be ready by 2019 while Seda Nuvali’s second tower is expected to be completed by 2020.
The three new properties to be launched in 2019 are: Seda Residences Makati with 293 rooms; and, Seda Cebu IT Park with 214 rooms. In 2020, it will complete Seda Manila Bay in Aseana City with 350 rooms.
After launching its first resort line in Lio, El Nido last August, Seda is next venturing into the serviced residences that offer bigger rooms and additional facilities like a kitchenette and washer/drier machines.
“It’s our first time to go into this kind of market. There’s a need for long-long-staying accommodation so we decided to start with Makati Residences and behind this development, the extension of BGC, we will have good amount of serviced residences—48 units,” Mastellone said.
Apart from expanding into new categories such as serviced residences and resorts, Carlos said Seda’s entry into large city hotel formats was part of efforts to tap the MICE and wedding markets, in addition to business and leisure.
Seda BGC is so far the brand’s best-performing property. Accommodation in this property costs P6,000 to P8,000 per night. Outside Metro Manila, Seda’s room rates typically range between P3,000 to P4,000 except in Cebu, which fetches a price of about P6,000 per night.
The majority of Seda’s business is driven by corporate travelers, while around 20 to 25 percent comes from booking through digital platforms.
Seda’s current portfolio also includes properties in Cagayan de Oro, Davao City, Iloilo, Quezon City, Bacolod and Cebu. When it was launched in 2012, it initially focused on serving the needs of business travelers with boutique city hotels with less than 200 rooms, then ventured into large format city hotels with Seda Vertis North in Quezon City which has 438 rooms; and, into resort hotels with Seda Lio with 153 rooms.
Carlos observed that Seda’s evolution toward being a leading Philippine hotel chain competitive with international brands was best exemplified by the growth of its flagship Seda BGC from 179 rooms to 521 rooms in just five years.
“We knew as early as our first year of operation that Seda BGC would need an expansion sooner than later,” she said.