Added luxury, rising material prices cost Rs. 902 m more for now 5-star Citrus Waskaduwa
Tuesday, 24 December 2013 00:40
Added luxury, new facilities and higher material prices have pushed the cost of upcoming Citrus Waskaduwa resort by an extra Rs. 902 million as opposed to Rs. 1.8 billion stated in the IPO prospectus, the company has disclosed.
The company said Citrus Waskaduwa is well on the way to start operations ahead of schedule in early 2015. Although it was originally planned to be marketed as a four star property, Citrus Waskaduwa will now be marketed as a five star property.
This is following the overall product offering of the 150-room property redefined with added luxury, upgraded facilities and new amenities.
“This is due to changing market conditions and the evolving demand of the trade and tourism industry. The anticipated landscape of the hospitality offering in this geographic area has also changed. This has created an opportunity for a premium property in Waskaduwa. Citrus Hikkaduwa was upgraded and refurbished recently which gave rise to the need for the Citrus brand to offer a solution to tourists from the supper segment of the market,” the company said in its filing to the CSE.
Expedited construction has also faced many challenges such as escalation of construction related items including cement, steel, sand, bricks, tiles and glass. In addition, fluctuation in exchange rates has also adversely affected cost of imports of construction material and hotel operating equipment.
The Board of Citrus Waskaduwa has proposed to raise additional cost by way of inter-company borrowings or financial institutions or by way of an injection of fresh capital, the company said adding that a final decision would be taken in the near future.
The additional costs were attributed to the following key areas of its construction.
All 150 rooms have been enhanced with extra space, better quality finishes, king size beds, day beds, larger TVs, luxury bathrooms fittings and other amenities. A junior suite has also been added to the inventory in addition to the presidential suite.
Four additional restaurants offering specialty cuisine of a wide variety to guests while the capacity of the main banquet hall was accordingly increased and its facilities enhanced to international standards. This was done in anticipation of hosting international events and to promote the hotel as an ideal location to host large scale MICE events given its proximity to Colombo.
The hotel will also feature a secondary banquet/conference hall with a capacity to host 200 guests. The gymnasium has also been relocated with additional space included for more equipment in keeping with five star standards and will include an indoor games room with billiards/snooker tables and a signature bar within this area. An additional 80 perch block facing the sea adjoining the existing property has also been developed for an outdoor amphitheatre.
Citrus Waskaduwa has also invested in initiatives to control anticipated escalating operational costs. These include a large water treatment plant in order to store and recycle water, as well as LED lighting for the entire hotel to save on power consumption.