Interview with Global Business Guide Indonesia
The hotel business is ultimately a long-term investment, thus patience is needed rather than being easily swayed by momentary circumstances
PT Martel is a reputable hotel developer in Indonesia with a portfolio of successful projects which includes five-star hotels such as the Bali Imperial Hotel and the Grand Preanger Hotel in Bandung. What more can you tell us about the history of your company?
PT Martel was founded as part of a diversification strategy for our main venture in the oil and gas sector. We recognized the volatility of that particular sector which comes with the promise of high yields but also entails high risk; hence we looked into tourism where we especially considered the prospects in the long-term. We initiated our first involvement in the industry with the Grand Preanger Hotel in Bandung, West Java, by acquiring the 100-year-old hotel on a 30-year lease. Subsequently, we developed the original building which was constructed in the Dutch colonial era by adding 150 more rooms to the initial 50 rooms. After the renovation was completed, we officially reopened the hotel in 1990.
Our following project was the Bali Imperial Hotel in Seminyak, Bali. The idea for this hotel itself was conceived after frequently having stayed at the legendary Imperial Hotel in Tokyo during our business trips to that city. Hence, we decided to build a hotel to be managed by the same company. However, we eventually sold the hotel more than ten years later due to a number of reasons. In 1995, PT Martel opened the Novotel Hotel in the city of Bukittinggi, West Sumatra. This four-star hotel already has the distinction of having attained an architectural award for its design which was the work of renowned Thai architect, Mr Lek Bunnag, and US landscape artist, Mr Bill Bensley. Additionally, we also have several smaller-scale projects, one of which is in the city of Berastagi, North Sumatra.
Indonesia has seen a steady rise in the number of tourist arrivals over the last several years and the government also plans to waive visa requirements for citizens from 92 countries by the end of 2015. What is your outlook for the country’s hospitality industry for the short and medium-term?
The hotel business is ultimately a long-term investment, thus patience is needed rather than being easily swayed by momentary circumstances. For 20 years, industry players had been focusing on Bali and ignored places like Lombok in West Nusa Tenggara. That said, a clear indicator of Lombok’s growing importance as a tourism destination is the number of flights to that island which currently reaches 40 times a day; from locations such as Jakarta, Surabaya, Makassar and Singapore. With this growth, room has been created for hospitality service providers to expand into. In acknowledging this, PT Martel already has a project in progress on the island of Gili Tangkong. Besides Lombok, other regions that offer vast opportunities given their rising popularity include Labuan Bajo in East Nusa Tenggara as well as the Raja Ampat Islands in West Papua.
President Joko Widodo has identified Indonesia’s inadequate infrastructure as a challenge that needs to be addressed to support the country’s growth. In your opinion, what should be the government’s priorities for infrastructure development with regards to your particular industry?
Building a country’s infrastructure requires a well thought-out plan. Furthermore, in Indonesia’s particular context, we have major difficulties in funding our projects; government allocation through the state budget will never suffice. In this regard, one unfortunate example of inadequacy in terms of planning is the recent case of the Jakarta-Bandung high-speed train project. Apart from the abrupt cancelation and reinitiating of the project, the priority in the first place clearly should be from Jakarta to Surabaya as it will have a much-needed multiplier effect on the economy.
What are PT Martel’s future plans in terms of new projects to add to its growing portfolio?
This company is currently in the negotiation phase for a new project located in North Jakarta; in a site under development by state-owned company, PT Pembangunan Jaya Ancol. We are seeking to build a hotel in this area which attracts 18 million visitors annually. We are also developing villas in northern Bandung. With regards to the aforementioned Gili Tangkong, we plan to develop a resort on this 60,000-square-meter island. Another location which we have deemed as highly prospective is Makassar, South Sulawesi. Additionally, we will be operating ten-cabin yachts in Labuan Bajo and Raja Ampat.
Foreign investors have been quite active in Indonesia in recent years. How is PT Martel positioned towards working with international firms?
PT Martel is already engaging interested firms from abroad as we speak. For example, we are presently in talks with ONYX Hospitality Group from Thailand for a prospective partnership in investment and management. Overall, the best possible synergy between local and foreign companies perhaps pertains to know-how and technology.
What is your final message that you would like to share with our readers?
I encourage Global Business Guide's readers to come to Indonesia, a country massive in size as well as in the availability of opportunities. Furthermore, as a market, a population of over 250 million people can only serve as another reason for optimism among businesses.