Hotelivate, an India-based hospitality consulting firm, has opened its fourth office in Jakarta, after Delhi, Mumbai and Singapore, with Satria Wei, a veteran hotelier with over 30 years of experience, taking the reins as managing partner and managing director of Hotelivate Indonesia.
Satria was formerly the COO at MNC Land Bali, providing asset management and operational assistance in integrated resort projects such as Trump Resort Lido, Trump Resort Bali and Park Hyatt Jakarta. Prior to that, he was with PHM Hospitality.
Manav Thadani, founder and chairman of Hotelivate, said in a statement: “Our teams have been monitoring and working in various Indonesian markets for over six years. While the hospitality market cycle was on a decline during much of this time, Hotelivate ran five editions of THINC (Tourism, Hotel Investment & Networking Conference) in Bali and Jakarta. We now observe a clear upswing in performance, and more importantly, in market sentiments.”
He added: “With the recent reelection of the government, we see a continuation of strong sentiments and feel this is an appropriate time for Hotelivate to set up an office in Jakarta.”
Satria told TTG Asia that his decision to helm Hotelivate started with his concern over the low room rates in Indonesia, particularly among individual-owned properties, as compared to other countries.
“I have been working with hotel management companies and trying to increase our prices has been difficult when the hotels around us were not trying to scale up but instead undercut our prices. (Improving hotel room rates) needs a concerted effort by a group of hotels in the area,” he said, adding that he will work with those hotels to improve their bottom line.
He said that Hotelivate Indonesia, which offers end-to-end hospitality business solutions, could play a role in improving hotel room rates and the first service the firm will offer is revenue and asset management, primarily to individual-owned hotels, and possibly for branded ones too.
Satria stressed on the importance of these services, citing the example of room rates in Bali’s Kuta area. “There are two- and three-star hotels selling their rooms for as low as Rp100,000 (US$9) to Rp200,000. Branded properties have their own revenue management, something that individual-owned properties are lagging behind,” he said.
He also observed that the rate of a room in an economy-branded hotel in Mumbai was double that of the same brand in Bali.
But with proper revenue management, Satria said, many hotels in Indonesia can potentially increase their average room rates by 15 to 20 per cent.
“I have met hotel owners who wanted to see their properties increase in value so that when they release their hotels into the market after five to 10 years of operations, their properties will not only be valued by the land – like many of them today – but also the assets,” he said.
Many hotels across Indonesia are engaged in price wars due to an oversupply situation and thus, may be resistant to spending their thin margins on consultancy fees. “We realise that imposing fees up front will not work, so we are formulating a different scheme whereby hotels pay only after they see the results,” said Satria.
Expounding the feasibility of the scheme, which is still in the planning phase, he said: “If the current average room rate is Rp500,000 and after working with us it increases to Rp600,000, I think hotels will not mind paying 15 per cent of Rp100,000 to us.”