Thai Hotel Owner Unlocks Water Parks, Residences for IHG
Proudputh Liptapanlop: “Management companies come and go. What important is the people who stay with you.”
Rides at the new Andamanda Phuket were designed by WhiteWater West, which counts Atlantis Dubai as a client
By Raini Hamdi, 31 May 2022
Proud Group Thailand contributes close to 1,200 rooms in four hotels and one residences project to IHG’s portfolio. This includes a second Holiday Inn that sits within a water park, the $134 million, nine-hectare Andamanda Phuket which soft-opened on May 22.
Its executive director, Proudputh Liptapanlop, joined the family business in 2013 after graduating from Oxford University and a stint at McKinsey & Co. She quickly proved that the next generation Asian hotel owners want to create their own empire, not just continue the business.
Some may go irredeemably wrong but “Prou,” as she is known, is “not your party Paris Hilton,” according to an insider.
“She has the vision, brings in new thinking, takes risks. She gives operators the space, but is also the kind of owner that keeps you on your toes. She always knows what’s happening. She’s not fixed on solutions, but on outcomes,” said the insider.
Proudputh talks to Hotels-Asia about a range of topics, including the role of hotels in water parks, owner-operator relationship and whether hotels are still a good investment after Covid.
RAINI: So what’s the fascination with water rides?
PROUDPUTH: (Laughs) I’m a water lover. Diving is my passion. Water parks are a good addition to the travel experience. They are becoming a key tourism attraction; Dubai, Singapore all have them. They are part of the competition to get international tourists to visit Thailand.
How will your Andamanda Phuket beat the ones in Dubai, Singapore, Sanya and others?
Consumers want a holistic experience. So instead of just having the biggest, fastest and longest rides, we’ve added elements of culture, themed around Thai mythologies. And there’s something for everyone — shops, parades, concerts, not just water slides.
In phase two, we’ll be adding a 300-key Holiday Inn and a lifestyle space of around 2,000 sqm focused on F&B, which we expect will become the hangout spot of Phuket. It sits around a wet design water show — should be spectacular.
Your favorite water park in the world?
The Siam Park in Tenerife [Spain], which is so unique it’s actually a reason why people go to Tenerife. The park is also themed around Thai mythologies. I love how it integrates culture into technology and hard rides. I believe it welcomes half of the more than five million visitors who arrive in Tenerife each year.
What about the numbers for your water park in Phuket?
Once tourist levels return to normal, we should get one million of the 10 million international arrivals a year that Phuket gets [before the pandemic] to Andamanda. I’m confident, because the nationalities of tourists who visit Phuket, for example Australians and Europeans, love water and want to escape from the cold during winter seasons. A water park is also a more controlled environment than the beach, especially for those with families, so they can properly relax.
We’re looking at a payback within six to eight years, pending of course on there being no major crises such as Covid-19, wars, etc.
Were you able to get many international visitors to your first water park, Vana Nava, in Hua Hin?
It was 100 percent domestic when we opened the water park in 2014 but over time, international business grew and by 2019, formed about 15-20 percent of visitors, contributed partly by the opening of our first Holiday Inn there.
What is the role of hotels in water parks?
They are part of the whole ecosystem. Water parks generate the demand, hotels keep the visitors coming back as they complete the experience and make the stay memorable. Without a hotel, may be people would go once to the water park; with a hotel, the trip could become a summer holiday tradition.
Holiday Inn has fixed standards. How flexible is IHG in the design, decor and amenities/facilities that go with a water park?
For sure there’s a partnership and trust between us. They have piloted a few concepts with us. The Holiday Inn in Hua Hin [opened in 2018] was the first Holiday Inn hotel [in Asia] that sits within a water park.
They know hotels; we know water parks, so it’s been a fun journey with them.
When you first chose IHG, opening the InterContinental in Hua Hin in 2009, what were the factors?
We looked at them as one of the leading international hotel brands. Another factor was market condition. At the time, IHG didn’t have a presence in Hua Hin. The InterContinental suited Hua Hin in a sense that it has a strong resort standing and a strong business [travel] standing. At the end of the day, Hua Hin is a family and a MICE market.
We saw a gap. Hua Hin was perceived as a premium but not a luxury destination. The rate at the time was not more than 4,000 baht [$117].
Then, we launched [the 238-unit] InterContinental Residences in Hua Hin two years ago, the first InterContinental-branded residences in Thailand. For some reason, IHG lagged behind the other players when it comes to branded residences and they are using our project as a prototype to expand InterContinental Residences in other countries.
Is it all sold?
Sold 90 percent. It’s hard to find beachfront land in a good location in Hua Hin, in fact I don’t think you can find it anymore.
But the project is done by Proud Real Estate, which is public listed and handles residential developments for sale. Proud Group does leisure and hospitality and is privately owned.
Chains were forced to restructure, in fact IHG did it twice, in 2017 and 2019, even before Covid. So teams you worked with changed. Did that affect the partnership?
Personnel changes are normal in any organization. At the end of the day the culture of IHG remains. They are very flexible with owners in co-creating or adding inputs to hotels.
We are getting along with the new team just fine. If there was any difficulty, it’s that they couldn’t travel during Covid-19 and all our communication was done online. They’ve just started traveling again this year.
Is the relationship exclusive?
Generally, you work with people you know and trust.
What’s your biggest business lesson from Covid-19?
Creativity is the key to finding your way out of a crisis. With the absence of the MICE market in Hua Hin, for example, we turned the InterContinental into a pet-friendly accommodation to attract more domestic demand. We actually saw people staying longer and paying a higher rate. Creativity goes a long way to doing something you’ve never done before.
There’s a view that chains, having downsized corporate offices, weren’t able to support owners, and that they were also slow in demand generation. Did you have to be more hands-on in creating new demand for the hotel during Covid-19?
We’ve always taken a different approach on this. We create demand not just for the hotel but for the destination as a whole, because we have a few operating pieces. In Hua Hin, besides the two hotels, Holiday Inn and InterContinental, there’s the Vana Nava water park, also the sports complex, True Arena, and the resort mall, Bluport. So we do quite a lot of events to promote a more active lifestyle for Hua Hin.
Being an early millennial, I sort of see what millennials want. It swings between two extremes, the love for the peace and quiet of luxury hotels and the love for an active lifestyle. So we try to strike the balance for them.
On efficiencies, to be honest, management companies come and go. What important is the people who stay with you. Majority of the staff below management level have been with us for more than a decade. They are all Thai; home is Hua Hin. It is my responsibility to look after them, and to ensure they have a career path. Covid was a good opportunity for this, because rather than focusing on one task, everyone had to do different functions. They all had to be creative in finding new revenue sources. It’s good for us and for them.
Is there an example of how they were able to generate new revenue streams?
When the hotel was closed and there was no revenue, they were helpful with suggestions. They started doing takeaway deliveries and turned the beachfront restaurant into almost like a grocery store where you could come from the beach and grab something.
They understood the situation. We took care of their welfare, providing accommodation and meals when needed, and we offered meals for their families during the hard times. Some of course decided to go leave but a lot chose to stay.
Do you face a labour shortage?
We haven’t filled all the positions. We’ve also learnt to keep costs down — it was eye-opening to see how much fat there was in operations. But of course the struggle will come in the high season.
Back to Gen-Y and Gen-Z. As an early millennial, what else do you note about these travelers?
They are more aware of the impact they can have on island destinations, such as Phuket. With that generation, green tourism, helping communities and authentic experiences are big.
Luxury travel will change. It’s not about big beds and marble floors but experiences they will remember. It is also our job to showcase local culture. We try to integrate it as much as possible into the design of our projects, or through partnerships with local players.
What are the myths about younger generation owners?
They probably say we don’t work as hard, or are not as ambitious, as the previous generation. I see the opposite. We are the generation who have started a lot of things. The start-up economy that is going on shows how entrepreneurial my generation is.
Also, traditionally, with family run businesses, the next-generation is expected to join and continue the business as usual. But this is changing. More and more, they want to follow their own path and create their own empire, as opposed to just taking it on.
That’s you?
In some ways. I was lucky it wasn’t something that was passed on to me but that I was able to help build.
Biggest challenge?
It’s macroeconomics. How Thailand can compete with other nations especially in the short term. How fast we can reopen the country. There have been so many requirements and restrictions whereas some destinations have opened freely with no paperwork needed.
We had a good headstart with the Phuket sandbox but now we’re lagging a bit although the government is trying to change that. Test & Go is gone but we still have the Thailand Pass.
Apart from the short term challenge, how can destination Thailand improve?
Covid-19 is good lesson for all of us. Rather than focusing on numbers, we start looking at spending per head. Whether you’re a hotelier or industry professional, you look at the customer journey end to end, getting them to spend breakfast, lunch, dinner and activities with you, not just the typical bed and breakfast.
Also, with the start-up economy, we’re seeing more entrepreneurial products. Smaller players are booming and it’s our responsibility in the tourism industry to help promote these ventures, be they cafes, restaurants or souvenir shops, as they are part and parcel of giving tourists a slice of the Thai culture.
Is owning hotels still a good idea after Covid-19?
I think so. Hotels are a physical experience that can’t be replaced by the digital disruption. No matter what, people will still want to travel. You can look at a picture of an ocean or a beach as much as you want but it’s not the same as being in the ocean or on the beach yourself.
What needs to change is how we run hotels, how we market hotels, and how we can be more responsible towards the environment.