KUALA LUMPUR: Increased investor interest is leading to an increase in property deals, particularly for assets such as hotels in the hospitality industry.

Malaysian Association of Hotels (MAH) chief executive officer (CEO) Isaac Mohan Raj said property deals, including those for hotels, had seen a significant uptick in recent times.

He added that many players were actively seeking to purchase existing hotel properties with the intention to upgrade them.

On the planned sale of Holiday Inn Express Kuala Lumpur City Centre, here, he said the association could confirm that the hotel was indeed on the market.

However, he added that the sale of the hotel was more of an exception than the norm.

"The surrounding business situation along Jalan Raja Chulan is not vibrant, with many office buildings closed or are closing.

"This sale can also be attributed to the rebound of the tourism sector as owners could obtain a higher value," he noted.

Riyaz Hotels and Resorts chief executive officer Yap Lip Seng said hotel sales and acquisitions were pretty much a norm in Malaysia.

The former CEO of MAH said the new investors would either rebrand or refurbish existing properties to further elevate their values.

"International brands are also entering the Malaysian market. At Riyaz International Sdn Bhd, we, too, are expecting a few more hotels in the next one to two years."

Meanwhile, Yap said Malaysia's hotel occupancy was improving year-on-year, based on industry benchmarking platform A-DATA.

For 2023, it peaked at 66 per cent in December before closing the year with an average occupancy of 56 per cent.

He added that in the first two months of this year, there was an incremental increase in occupancy compared to the year before, mainly driven by festivities and holidays.

"But it has yet to return to pre-Covid-19 pandemic levels due to strong (tourism sector) competition from neighbouring countries, with most, if not all of them, eyeing the lucrative Chinese market."

CCO & Associates (KL) Sdn Bhd executive director Chan Wai Seen said he would not be surprised if more hotels in Malaysia were put up for sale.

"It gives the owners an opportunity to exit the hotel market at the right price."

He noted that many new hotels had also adopted international hotel branding.

"After the opening of the international borders, hotels are showing an improvement in terms of average daily rate and the occupancy rate.

"The proposed sale of Holiday Inn Express Kuala Lumpur City Centre is normal and in line with the market as many owners want to monetise their property when the market sentiment is positive," he added.

To recap, the Holiday Inn Express Kuala Lumpur City Centre was put up for sale last week on the real estate firm Colliers Hotels & Leisure's website.

However, the reserve price was not revealed.

The proposed sale includes a total strata area of 160,414 sq ft and includes all 384 rooms.

The hotel is currently operated under the Holiday Inn Express brand, owned by the InterContinental Hotel Group (IHG).

Colliers director of hotels and leisure Zoe Zhou said this freehold mixed-use development offered a rare opportunity to acquire an existing operational hotel asset with a renowned international operator generating stabilised cashflow, together with strong rental income from office and retail leasing.

"The investment also comes with the potential of a new tower to accommodate both residential and commercial use, maximising the existing land use," he said in a statement on Colliers' website.

According to Colliers, the detailed information relating to the proposed sale can be obtained upon the execution of a non-disclosure agreement.

By S. BIRRUNTHA