This project is at the preliminary stage. Currently the Island is leased to private company in Maldives. We have already negotiated a total buyout of the government lease agreement from the existing party for a US$2.5 Million. We are expecting the costs related with initial acquiring, conceptual drawing, environmental analysis, and kick-starting the project would cost around US$3 Million. And Further US$20 Million would be needed to develop the property, which will be funded from bank or a secondary investor.
This cost is relatively very less, in comparison to other such resort investments. For example, the current market going rate of acquiring an Island is US$4 to 5 Million, and another US$ 40 Million is required to develop a property.
Room Revenue US$120 x 300 R x 365 D x 75% O US$9, 855, 000
Food (Restaurant and Coffee shop) US$30 x 600 P x 365 D x 75% O US$4, 927, 250
Bar Sales US$20 x 600 P x 365 D x 75% O US$3, 285, 000
Excursion, Water sports and Diving US$25 x 600 P x 365 D x 75% O US$4, 106, 250
Spa (Average) US$20 x 600 P x 365 D x 75% O US$3, 285, 000
Souvenir Shop US$15 x 600 P x 365 D x 75% O US$2, 463, 750
Total US$27, 922, 250
As per the above revenue we are expecting a total cost of USD 14, 292, 986.00.
We are expecting the profit and revenue a lot better than a remote resort, yet with lower investment. But i have calculated the revenue at the lowest forecast.
Hankede is located in Addu Atoll, the southernmost part of the Maldives. Addu is second populous region in the Maldives, and is home to majority of the industry’s labour force. Due to British Air Base during Cold War, made Addu citizens an early exposure to Western culture. Distinct from other regions, much of its landmass,
like island towns are connected with cause ways (Bridges). The Atoll has both an International airport, and a sea port. Addu is located around an hour away from Male’ international airport.
The Southern region, is home to best dive spots, surfing spots, and natural islands in Maldives.
Unlike other natural islands that are developed as tourist resorts, Hankede Island is located between two local villages, connected by small cause way bridges. This makes, Hankede somewhat a unique place to develop a city style easy accessible resort, yet offering popular Maldivian experience.
Having easy land accessibility to airport, port and towns, the biggest advantage of developing a hotel in Hankede is, investors can avoid typical logistical and time related costs, which usually incur developing a remote island resort. Similarly, Hankede location does not require it to develop staff accommodations, canteens and much related supporting infrastructure. The developer can connect the resort with the main electrical grid, avoiding energy related investments and its operational costs. As a whole, this lets the developer to keep minimum buildings that are directly related with revenue, like rooms, bars, restaurants, and etc. This is a rare opportunity in Maldives, considering land scarcity of typical resort
Hankede is also unique in many other ways. Apart from having huge lagoon, beaches, nearby historical and dive spots, and surroundings, the island also offers one of the best Sunset experience in Maldives. The developer also could consider increasing the land and beach area if required. Further Hankede geography and its location allow itself to offer somewhat similar experience like Phuket, Bali, and other such destination experience to tourists. This opening could spill-over on the regional tourist trend too.
The hotel is developed in three phases. In the first phase the developer build a three to four star 300 room hotel, where nightly average room rate is between US$120 to US$150. In Second Phase the hotel would attempt to build another 100 rooms targeting nightly average rate of US$150 to US$180, and similarly in Third phase another 100 rooms would be added to property. The developer expects a 5-year period between each phase.
One of the biggest advantage of Hankede hotel has in comparison to booming village hotel industry is, Maldivian law allow Hankede to offer alcohol and other such related entertainment facilities. At the moment Maldivian law only allows alcohol to be sold in uninhabited islands, barring other 100 percent city hotels, guest house that are around in Maldives. This makes Hankede hotel, a unique Maldivian affordable hotel (considering guest houses already charge similar rates), secluded, yet connected within few minutes from villages.
Therefore, Hankede could differentiate itself from most of the hotels, resorts in Maldives having an occupancy edge over others.
Having one of its kind unique property in Maldives, many of the midrange hotel chains like Holiday Inn Express, Hilton, Traders and several others would take extreme interest in managing this property. The developer could potentially negotiate interested parties before conceptual drawings are finalized, to give space for client’s adjustments. Having the right management company will give both occupancy and revenue assurance for the investors.
However we also have the capability of running the hotel on our own as well.
Maldives is one of the high end tourism destination in the world and is already a tested brand. Tourists from worldwide markets spend their holidays in the Maldives resorts throughout the year.
We are proposing instead of making a luxury bungalow resort, make a vertical building just like what we find in phuket, or any other. This way we can create any number of rooms
— Maldives average resort room rate is around US$600 per night now. usually 90 percent resorts are targeting a small niche or very rich clients
— this led 80s and 90s mid-market go away, like divers, surfers, backpackers, relaxers.
— This market has started coming again, due to increase of guest houses in local villages.
— Guest house rate ranges from US$60 to US$200
Hence with the advantages of having to sell alchohol unlike in guest houses and city hotels, we can sell the rooms at a lower price and earn the income from extra services such as excursions and food and bevarge services.