Conversation – Hussain Afeef

11 mins read

For this installment of Conversation, Hotel Insider has a chat with tourism pioneer Hussain Afeef (Champa). Among other things, we talk about the Maldives’ increase in bed capacity and what that entails, whether the Maldives is losing its luxury tag, developments down south in Addu and we close with some thoughts on the future of the industry.

Hotel Insider: We’re seeing a period where there’s an increase in beds in resorts and guesthouses. Also, a number of new properties are to open over the next couple of years. What do you make of this? Is it worrying?

Hussain Afeef: I think it’s good. The country’s going through a transformation; you see, we started with cadjan huts, then we saw coral buildings, and then we had modern airconditioned structures. The industry has been continuously developing, and we’re at a stage where you see mega projects in the making. Foreign investors are coming and putting in a lot of money, hundreds of millions of dollars. The evolution is ongoing; it’s because people have trust and faith that they invest such vast sums. You have these high-end properties and you have mid-range resorts, then you have guesthouses. There’s a complete spectrum of accommodation. The rich man, who can afford a resort, stays there; it doesn’t matter if there are guesthouses on nearby islands. At present we have around 29,000 beds [at resorts]. You put in another ten thousand, it’s just 39,000 beds. It’s still nothing compared to our markets abroad, a place like Spain for instance, where a few resorts combined will have that many beds.

Hotel Insider: You don’t think the market is saturated?

Hussain Afeef: I don’t. Let me tell you why I think this is. We have the airport project [Velana International Airport] and once it’s complete there’s going to be a new runway and terminal. With these, we’ll have the capacity to bring in more tourists. When you talk about market saturation, you also need to understand that we cannot take in any more people. We can’t grow right now because of the bottleneck created at the airport. The runway clearance times are long and it’s very hard to get slots for airlines wanting to come in to the Maldives. For European carriers, the slots must be in the morning; they have to get back to Europe before the airports close down traffic for the night. Passengers must be able to catch the last train home. You have to consider these things. That’s why there’s so much congestion at our airport during these times. With a bigger airport, we can definitely accommodate more people. If it happens, more planes will come bringing more passengers. Where will you put these passengers? It’s a kind of chicken and egg situation. Do you construct resorts first or do you build the airport and build hotels later? What happens is there will be a time, maybe a couple of years, where some resorts will have to struggle because of an overabundance of beds. But once the project is completed, I think we’ll be OK. We’ve got resorts and guesthouses, there’s something for everyone.

Hotel Insider: Speaking of which, we seem to be moving away from an exclusively luxury tourism model. What do you think of that? What does it mean for luxury brands in the country?

Hussain Afeef: Are we moving into or out of luxury? I don’t know. What I’ve heard is that there are different foreign companies coming in and investing in ultra-luxury properties. I won’t say that the luxury element will go away. A lot of people think we’re losing the luxury tag, but I don’t think so. Things are always evolving and we’ll adjust. The tourists will also adjust. That’s what will happen.

Hotel Insider: Do you see us becoming another like Bali for instance?

Hussain Afeef: In terms of mass tourism? Not at all. You might get that feeling at the airport but I don’t see that happening here.

Hotel Insider: What do you make of the integrated development projects that the government’s undertaken? Like at Emboodhoo lagoon?

Hussain Afeef: It’s not our traditional way of doing things, it’s not a traditional model. I think with such projects the industry will be taken to an entirely different level. It’s beyond our reach to invest in these projects, it’s a lot of money. Things like these can only be accomplished with international parties, and it’s good to have them. It creates confidence in the market, it signals to the world that the Maldives is a good place to come and invest in.

Hotel Insider: We also wanted to ask you about Addu Airport. How’s that going? It’s very underutilised at the moment isn’t it?

Hussain Afeef: Yes, definitely. But things are changing, as you know, today we have SriLankan flying there and even that, small as it is, is creating a change in Addu. You can get fresh vegetables there, somebody can take a flight from Addu to Bangkok if they want. It’s a big achievement in my opinion.

Hotel Insider: You know, the government says it’s planned to increase bed capacity down in Addu by some 3000 beds.

Hussain Afeef: If that happens it’ll be good. Even now we have people from Europe who want to visit. What that place needs is two or three-star properties with a couple of thousand beds, budget beds really. If we get those, Addu will take off, even today.

Hotel Insider: When we talked to some people there, they were saying the problem was that investors were reluctant to invest in beds because there were no flights coming in, but there weren’t any flights because there weren’t enough beds.

Hussain Afeef: [laughs] It’s the chicken and egg problem again. That’s why we built the airport (note – Afeef’s KASA Holdings has a 30 percent stake in Addu International Airport (AIA) Pvt Ltd). It’ll be like a new injection into the tourism industry. Addu is such a fantastic place. I think a two or three-storey hotel complex with some beach and water bungalows, conference facilities and a good pool will be great down there. With that, we can attract the wedding market and also be on the conference circuit. We can organise tours around Addu for guests, they can go on buses, stop at cafes, buy souvenirs. We can really revitalise the place. I was also thinking that we can get the Asia Swimming Federation to hold conferences and events there. We can’t do that in the Maldives right now because we don’t have a good enough swimming pool. We can get them to have competitions down in Addu. When the airport on Hulhule was built, we had nothing. No transfers, nothing. The government built the airport and the private sector came in and did the rest. The government didn’t have to invest in speedboats or seaplanes. You can obviously see how the airport’s spurred a lot of business in Male and the region. We didn’t reinvent the wheel. What happened here can happen in Addu. There’s so much potential there.

Hotel Insider: Before we wind up, how do you see the tourism industry five or ten years from now?

Hussain Afeef: I think in five or ten years the industry will settle down. What I mean is that most of the investors will have come by then and the industry will be mature. Right now, we’re at a point where a lot is happening, new investors are coming in but in five to ten years people will have settled down, the investments that are being made now will be bearing fruit.