Sri Lanka’s over-priced hotel boom ending: equities report

Feb 09, 2013 (LBO) - Sri Lanka is about 500 to 800 US dollars more expensive than alternatives for a 10-day holiday with standards lower than competition, which may hit occupancy in the future, an equities research report has warned.





A 10-day holiday in Sri Lanka may cost between 2,000 to 2,600 US dollars with a 4 to 5 star category accommodation or twin sharing, with airfare, 'Trying to live up the hype," a report on the leisure sector released by Capital Alliance, a Colombo brokerage says.

Sri Lanka's best facilities also do not compare with similar facilities elsewhere, the report said.

Incomparable

"Most of our 5-star hotels properties are comparable to 3-4 star products elsewhere," Purasisi Jinadasa, head of research at Capital Alliance told LBO.

But room rates were around 20 percent higher than competition with prices being driven up due to lack of international grade competition.

In Colombo the ratio of international chains to local was only 29 percent.

This compared with 43 percent for Mumbai, 60 percent for Bangkok and 68 perce