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Tune Enters Partnership with Evolution Capital Public Company
 Limited to Roll Out 44 No-frill Hotels Across Asia

By Boonsong Kositchotethana, Bangkok Post, ThailandMcClatchy-Tribune Regional News

December 18, 2009 --Tune, the Malaysian budget hotel venture affiliated with the no-frills carrier AirAsia, is making a debut in Thailand as part of its aggressive Asian expansion that could lead to more than 100 sites becoming operational by 2014.

The company announced yesterday a strategic partnership with Evolution Capital Plc (EC), a SET-listed real estate investment and management firm, to set up 44 Tune hotels, primarily in Thailand, as well as China, Bangladesh, the Philippines and Indonesia.

Tune is extending its franchise to EC, which will invest about US$100 million to set up compact hotels that open a new segment in the hospitality industry for very budget-conscious clients.

The first 24 Tune hotels should be in development by early 2010 and operational by 2012, with a staggered roll-out of another 20 hotels by 2013.

The first property under the Tune-EC deal will be near Phuket's Patong beach. The next sites will be concentrated on the southern resort island and Bangkok, said Evolution Capital managing director and president Simon Gerovich.

The deal with EC provides an impetus to Tune's Asian expansion, which had been lacking in the past few years since the concept was launched.

Thailand has been on Tune's radar for quite some time because of its growing tourism industry and the expanding network of AirAsia here, offering a synergy for its no-frills accommodation business.

Currently, seven Tune hotels, which are owned by the company itself, are operating in Malaysia and Indonesia. The first hotel was launched in Kuala Lumpur in 2007.

Tune group chief executive Mark Lankester yesterday reiterated a plan to have more than 100 hotels, each with 80 to 120 tiny rooms, in key cities across Asia by 2014. "Things are looking good for us to achieve the above 100-mark," he told reporters.

The hotels under the Tune-EC deal would be new developments or refurbished properties whose owners want to sell, said Mr Gerovich.

A room in a Tune hotel is only 12 square metres with bare-bones facilities. A fee is charged for services such as using air-conditioning, having laundered towels and other energy-consuming amenities.

Tune boasts five highlights for its hotels -- five-star quality beds, hot and cold showers, central and strategic locations, clean environments, and 24-hour security.

Tune's marketing tagline is "a 5-star sleeping experience at a 1-star price". It says rooms can be booked online from $3 per night.


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Copyright (c) 2009, Bangkok Post, Thailand

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