How is Berjaya Corp shifting its hospitality operating model?

Question

Accepted Answer

Berjaya Corporation Bhd is transitioning its hospitality division towards an owner-operator model, focusing on acquiring and holding five-star hotel properties rather than managing them.

Berjaya Corporation Bhd (BCorp) is strategically pivoting its hospitality division's operating model to emphasize ownership of five-star hotel assets. This shift involves gradually moving away from being a direct operator of hotels towards becoming purely an owner, engaging external expert operators for property management. This strategic reorientation is also accompanied by an asset rationalisation plan, including the divestment of non-core properties and an exit from certain markets.
Focus on Property Ownership Over Operations

BCorp's long-term vision for its hospitality segment includes the establishment of a dedicated real estate investment trust (REIT). This REIT is intended to exclusively hold five-star hotels owned by the group, rather than those it operates. This approach aligns with the group's evolving strategy, exemplified by the ownership of the Four Seasons Hotel in Kyoto, Japan, where an international expert operator manages the property.
Strategic Market Realignment and Divestments

The group is actively exiting markets such as China and Vietnam, redirecting its focus towards high-end hospitality ventures in locations like Japan. This preference for developed countries stems from their robust regulatory and legal frameworks, which are considered more conducive to hospitality business operations involving property and land. As part of this strategic realignment, BCorp has placed two resorts in Seychelles, a resort in Sri Lanka, and hotels in Hanoi, Vietnam, and the Philippines up for sale.
Response to Pandemic and Debt Reduction

This strategic shift in the hospitality division has been partly influenced by the COVID-19 pandemic, which underscored the necessity for greater focus. Concurrently, BCorp is pursuing a three-year strategic plan from 2021 to 2024 with the objective of reducing its debt levels. A key component of this plan involves the divestment of non-core assets to achieve its financial targets.

Reading history

Hide →

This history is cleared when the page is closed.

How is Berjaya Corp shifting its hospitality operating model?

Loading

Was this article helpful?

Helpful

Not helpful

Report an issue

1

0

0

Share with friends