Big investment has not been made in star hotels in the past five years
even though big business families have entered the sector. Investment is
being channeled in smaller hotels and resorts instead of luxurious star
hotels if one is to see the date of the past five years that shows that
new hotels are being established with investment of Rs 150 million to
Rs 250 million.
One has to spend at least a billion to start a star hotel in urban areas including Kathmandu Valley. There has not been addition of star hotels, apart from that of tourist standard, after 2009 with the number of five-star and four-star hotels still 10 and two respectively. The number of three-star hotels has increased by four to 15 in the period while that of two-star hotels has decreased from 27 in 2008 to 26 now. Similarly, the number of one-star hotels has also fallen from 26 in 2009 to 24 by the end of 2013. The number of hotels for tourists, however, has increased from 348 to 482 in the period. There are currently 567 star and tourist standard hotels in Nepal. The last big investment made in the Nepali hotel sector was in Hyatt Regency and the five-star hotels have only been upgraded after that.
President of the Hotel Association of Nepal (HAN) Shyam Sundar Lal Kakshapati feels that the number of new star-hotels has not increased as the investors cannot invest on land. “One has to invest around Rs 1 billion, the rooms will have to cost US$ 500 a day and the number of tourists should also be high accordingly. The trend of tourist arrival is decreasing. How can investment increase in such state?” he questions. There has not been significant rise in the number of rooms at five-star hotels after 2009. It was 1,539 in 2009 and is still around that as other five-star hotels like Yak and Yeti are still in the stage of reconstruction even though Radisson has added a few rooms. The number of rooms at four-star hotels has also not increased from 190 in the period while there has been some increase in the number of rooms at three-star hotels. It has increased to 596 from 372 in the period. The number of rooms in two-star hotels has fallen from 1,138 to 1,093 in the period while that in the one-star hotels has also not increased from 564. The number of rooms in tourist standard hotels and resorts has increased to 7,934 from 5,010.
“The government should lease public land to attract investment in big hotels. If we look at five-star hotels in India and other countries, almost 90 percent of them have been constructed in land provided by the government. We should bring similar policy in Nepal,” Kakshyapati states. He argues that foreign investment in hotels will not arrive until high-spending tourists come to Nepal. Chief of the Tourism Industry Division under the Ministry of Culture, Tourism and Civil Aviation Madhu Sudan Burlakoti says there have been more proposals for smaller hotels of tourist standard than for big hotels in recent times. “Eleven small and big hotels were registered in 2013 but they have not been completed yet,” he says. Five hotels have been registered in 2014.
Number of hotels
Source: Tourism Industry Division
One has to spend at least a billion to start a star hotel in urban areas including Kathmandu Valley. There has not been addition of star hotels, apart from that of tourist standard, after 2009 with the number of five-star and four-star hotels still 10 and two respectively. The number of three-star hotels has increased by four to 15 in the period while that of two-star hotels has decreased from 27 in 2008 to 26 now. Similarly, the number of one-star hotels has also fallen from 26 in 2009 to 24 by the end of 2013. The number of hotels for tourists, however, has increased from 348 to 482 in the period. There are currently 567 star and tourist standard hotels in Nepal. The last big investment made in the Nepali hotel sector was in Hyatt Regency and the five-star hotels have only been upgraded after that.
President of the Hotel Association of Nepal (HAN) Shyam Sundar Lal Kakshapati feels that the number of new star-hotels has not increased as the investors cannot invest on land. “One has to invest around Rs 1 billion, the rooms will have to cost US$ 500 a day and the number of tourists should also be high accordingly. The trend of tourist arrival is decreasing. How can investment increase in such state?” he questions. There has not been significant rise in the number of rooms at five-star hotels after 2009. It was 1,539 in 2009 and is still around that as other five-star hotels like Yak and Yeti are still in the stage of reconstruction even though Radisson has added a few rooms. The number of rooms at four-star hotels has also not increased from 190 in the period while there has been some increase in the number of rooms at three-star hotels. It has increased to 596 from 372 in the period. The number of rooms in two-star hotels has fallen from 1,138 to 1,093 in the period while that in the one-star hotels has also not increased from 564. The number of rooms in tourist standard hotels and resorts has increased to 7,934 from 5,010.
“The government should lease public land to attract investment in big hotels. If we look at five-star hotels in India and other countries, almost 90 percent of them have been constructed in land provided by the government. We should bring similar policy in Nepal,” Kakshyapati states. He argues that foreign investment in hotels will not arrive until high-spending tourists come to Nepal. Chief of the Tourism Industry Division under the Ministry of Culture, Tourism and Civil Aviation Madhu Sudan Burlakoti says there have been more proposals for smaller hotels of tourist standard than for big hotels in recent times. “Eleven small and big hotels were registered in 2013 but they have not been completed yet,” he says. Five hotels have been registered in 2014.
Number of hotels
|
Type of hotels |
2009 |
2010 |
2011 |
2012 |
2013 |
|
Five-star |
10 |
10 |
10 |
10 |
10 |
|
Four-star |
2 |
2 |
2 |
2 |
2 |
|
Three-star |
11 |
13 |
15 |
15 |
15 |
|
Two-star |
27 |
28 |
29 |
29 |
26 |
|
One-star |
26 |
26 |
26 |
26 |
26 |
|
Tourist standard |
348 |
387 |
423 |
442 |
482 |
|
Total |
432 |
474 |
513 |
532 |
567 |
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