CAAN proposes five-star airport hotel at Sinamangal

The Civil Aviation Authority of Nepal ( CAAN ) has submitted a proposal to the government for constructing a five-star airport hotel under the built-own-operate-transfer (BOOT) modality on its land plot in Sinamangal, Kathmandu.

CAAN officials said the move is intended to make commercial use of its 116-ropany land plot which has been underutilised despite being located in the city’s prime area. They said it is objectively aimed at facilitating tourism and offering accommodation to travellers landing at and departing from Tribhuvan International Airport (TIA).

The land plot currently houses the CAAN ’s TIA Improvement Project Office, and an Armed Police Force (APF) unit.

The proposal was forwarded to the Finance Ministry some six months ago, but senior Tourism Ministry officials say the Finance Ministry has not responded to the proposal yet. The officials said the concept to build an airport hotel under the public private partnership model can create more value for Nepal’s fast-growing tourism industry and it could be a big source of revenue for the government. “Besides, there is also a need for an international standard airport hotel.”

Finance ministry officials said the CAAN ’s proposal is still under-consideration.

The Tourism and Home Ministries and the CAAN have agreed to relocate the APF unit to Nalinchowk if the government approves the project, said a CAAN official. “If okayed by the Finance Ministry, the proposal will be sent to the Cabinet for final approval,” said Ranjan Krishna Aryal, joint-secretary at the Tourism Ministry.

CAAN officials said as soon as the government approves the plan, they would issue a letter of intent (LoI) for prospective developers. With domestic and inter-regional tourism aiding to hotel demand, a range of leading global hotel chains have planned their entry into Nepal.

Non-resident Nepali Shesh Ghale is building a five-star hotel in Kathmandu. The property will be known as the Sheraton Kathmandu Hotel. Ghale’s MIT Group Holding Nepal recently signed an agreement with Starwood Hotels and Resort Worldwide Inc and set the project rolling. Slated to open in February 2018, the 225-room Sheraton Kathmandu Hotel will be managed by Starwood Hotels & Resorts.

Also, Nepal Hospitality Group (NHG) signed a management agreement with a subsidiary of Marriott International to open a four-star property named Fairfield by Marriott Kathmandu. The international brand Marriott will look after the management of the Fairfield by Marriott Kathmandu. The NHG is a group company of the MS Group, one of Nepal’s leading business conglomerates. At present, there are 10 five-star hotels in Nepal—eight in Kathmandu and two in Pokhara. The average annual occupancy rate of these five star properties stands at around 65 percent. These properties produce 641,670 room nights annually. Nepal welcomed 803,092 visitors last year, of which, 204,834 came Nepal through surface transportation.

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