The newly launched Alta Hospitality Asia fund of Hong-Kong-based Alta Capital Real Estate eyes a prime real-estate in Galle to develop a premier wellness retreat with comprehensive facilities and luxury pool condominium as it hunts undervalued sustainable and wellness hospitality assets across Asia-Pacific including in Sri Lanka.
As the hospitality real-estate market faces disruptions, the Fund mangers plans to focus on opportunistic investing in undervalued hospitality assets in key urban and resort locations around Asia-Pacific including Thailand, Vietnam, Indonesia, Sri Lanka, Malaysia, Korea and Japan.
It plans reposition, rebrand and redevelop assets for the post-Covid world in order to deliver solid returns across a balanced portfolio of brownfield renovations and greenfield developments.
The opportunistic fund aims to create a $50 million portfolio and deliver an internal rate of return of between 15% to 25% over six-year period.
It is managed by Rakesh Patel, an experienced real estate investor and formerly HSBC’s Head of Equities for Asia-Pacific, who to date has managed a real estate investment portfolio with an average project equity Internal Rate of Return (IRR) of 32% over the last 16 years.
Patel himself has made a significant personal investment in the Fund, which has also supported in attracting solid commitments from other investors.
The Fund’s Advisory Board also includes leading figures in the fields of real estate, hospitality and sustainability, including Michael Davies, who has worked at leading global property companies and is the Founder and Chairman of Teardrop Hotels in Sri Lanka.
Targeting assets that are too small for global players and too large for individual investors, the Fund would focus on acquiring boutique hotels, wellness retreats and villa communities with 50 to 150 keys.
An attractive a prime hilltop greenfield development with unobstructed sunset views of the Galle Fort UNESCO heritage site and the Indian Ocean is among the properties identified by the fund.
The development would include a premier wellness retreat with comprehensive facilities and luxury pool condominiums.
With a six-year base, it targets a unlevered IRR of over 25% and a Multiple on Invested Capital (MOIC) of 1.9.
“Consumers are looking for more meaningful travel that incorporates traditional and modern wellness practices as well as authentic local experiences. They are increasingly mindful of the approach that brands take to the environment, their employees and the communities in which they operate. That is why wellness and sustainability are at the core of Alta’s investment strategy. We believe they can drive attractive returns for investors, create memorable experiences for guests and add value to local communities and the environment.” Patel elaborated.