Fresh confidence lifts Kuala Lumpur

Malaysia's capital is showing signs of growth as it attracts new foreign interest. Kuala Lumpur is regaining its self-assurance as a conference and events destination. By Stephanie Roberts Malaysia is experiencing an upsurge in business confidence. Its capital Kuala Lumpur is positioning itself as a city to invest and conduct business in and has already lured more than half of its 250 target multinational companies to its own version of Silicon Valley, the MultiMedia Super Corridor in Cyberjaya. Kuala Lumpur may not yet feature in the International Congress and Convention Association's (ICCA) chart of top global cities for meetings but with the launch of a Formula One Grand Prix last year, Kuala Lumpur is in the forefront of incentive and corporate hospitality organisers' minds. The event has brought more business for the hotels; this year's F1 saw all of the city's hotels full. And tourism arrivals have soared from neighbouring countries according to Tourism Malaysia statistics; business from Singapore grew by 62.9% between 1998 and 1999, from more than three million visitors to 4,900,084, while business from India and China is also encouraging. India's visitor numbers grew by 37.9% and China's by 19.4%. The results for January to May 2000 are promising, showing a further boost in tourist arrivals of 24%. In addition, the conference and incentive (C&I) sector believes Malaysian tourism minister Datuk Abdul Kadir bin Haji Sheikh Fadzir is committed to investment. Kuala Lumpur's C&I industry remains upbeat and confident about development within the sector, despite recovering from the economic downturn and recent detrimental media reports of kidnappings in other parts of Malaysia. "Incentive business is doing very well," admits destination management company (DMC) Destination East area manager Kuala Lumpur Ms Rani Vaithilingam. "The Malaysia Tourism Promotion Board (MTPB) is actively promoting the C&I industry so we can expect to do even better. For example, Kuala Lumpur is just starting to host familiarisation trips, which has not been done before." DMC Asian Overland Services deputy general manager, marketing and finance Ms Yap Sook Ling agrees that government promotion will boost C&I business to Kuala Lumpur. "Business is definitely better following the 'Malaysia Truly Asia' campaign," Ms Yap says. "The government has realised Malaysia has to project one image for the country and Kuala Lumpur has benefited from this. We work closely with the MTPB and it would be beneficial if there was more investment in the C&I sector as these visitors spend more." Kuala Lumpur is keen to expand these visitor numbers. One development certain to help is the upcoming National Exhibition and Conference Centre (NECC). The RM1million (US$263,000) development will be based at the former Sultan Abdul Aziz Shah International Airport at Subang, which has been superseded by the two-year old Kuala Lumpur International Airport (KLIA). The NECC will have 100,000sqm of floorspace and is due for completion at the end of 2002. The NECC will offer runway access for aircraft up to Boeing 747, with a dedicated taxiway leading directly to the exhibition hall. There are also plans for a five-star on-site hotel. "The NECC will showcase Malaysia and its industries to the world, promoting Malaysia as the prime destination for exhibition and convention events, spurring tourism and MICE-related industries," says Malaysia Airports Berhad business development manager Mr Raja Ridzwa Aziz. The NECC will be a welcome addition for the convention market, adding to the Putra World Trade Centre (PWTC) and Malaysia International Exhibition & Convention Centre (MIECC) at the Mines Resort City. While this will generate further competition, PWTC manager international marketing Mr Nor Azmi Sulong is undeterred. "The upcoming NECC will benefit the city and will complement us as MIECC does already," he says. "Next year the Dental Association congress will bring 10,000 delegates to the city and, as 3,000 is our maximum capacity, we will have to work with the other venues. Winning the large congresses is good business for everyone." PWTC is the largest conference facility in the city centre, offering an auditorium of 3,000, two conference halls, a ballroom with capacity for 1,000 and 17 meeting rooms with capacities ranging from ten to 250. The centre is also looking to expand one hall to 2,500sqm. "If the economy and convention market are sustained over the next two years, we will benefit from the expansion," adds Mr Nor. The local market remains the biggest for PWTC, generating 80-90% of business. "We are receiving a few meetings from Hong Kong and we've yet to tap into the Australian market, yet Singapore groups are coming back, especially as they find it value for money with the ringitt against the Singapore dollar," says Mr Nor. Encouragingly, 70% of PWTC's business is repeat and one major coup is the hosting of the Pacific Asian Travel Association conference between April 8-12, 2001. MIECC hosts many major Asia Pacific and international events. Since opening in 1997, events have included ASEAN Telecom 98 and Multimedia Asia 99. Located 20 minutes from Kuala Lumpur city centre, MINES convention and exhibition centre offers 1,552sqm of seminar and meeting areas, featuring three conference rooms, 11 meeting rooms and a business centre. Accommodation-wise at The Mines Resort City, the flamboyant Palace of the Golden Horses is well-suited to receiving conference groups. The hotel has 401 rooms and 80 suites. It features a ballroom and Unity Room, with capacities of 1,200 and 400 respectively for banquets, while the auditorium seats 318 theatre-style. The resort also offers the 178-room Mines Beach Resort & Spa. Meeting facilities include two ballrooms, with capacity for 150 and 280 respectively and a further five function rooms, plus a beach for team-building exercises. Kuala Lumpur's city centre does not lack five-star properties, although there is an extraordinary amount of building work in the city, particularly in the hotel industry. Unfortunately, work has been halted on some of them, a sign that the city has not yet fully recovered from the economic downturn. The Grand Hyatt is still under construction. The same is true of the 310-room Novotel. The Westin Kuala Lumpur remains scheduled to open in late 2001 or early 2002, although construction did stop for a couple of years during the financial crisis. Kuala Lumpur's existing hotels quote competitive rates. The Pan Pacific's rates start at RM305 and the Concorde's at RM320. Hotels such as Shangri-La and Mandarin Oriental are a little more expensive, starting at RM703 for the former and RM600 for the latter. Hotels are recording a healthy amount of C&I business. "Our conference, exhibition and incentive (CEI) business can go up to 35% during the peak seasons between March and May and then July to September," Pan Pacific director of MICE Mr Azahar Ahmad says. "We have a very international clientele, and quite a few groups from Australia, Japan and Singapore," he adds. The 550-room Pan Pacific's major lure for convention groups is its location adjacent to the PWTC. In fact, a sheltered passageway links the two. "We get a lot of knock-on business from PWTC and when at trade shows we often promote our services together," Mr Ahmad says. Conference groups can use the hotel's ballroom, with its capacity for 500 theatre-style and six meeting rooms with seating capacity of 30-100 theatre-style. The majority of Kuala Lumpur's hotels are well-suited for conference groups. The 720-room Shangri-La's ballroom and 11 function rooms have had a RM15million makeover, offering space for 2,000 theatre-style in the ballroom and function rooms capacities of 30 to 270. The two-year-old 643-room Mandarin Oriental, is still the newest property in the city. Its biggest selling points are its location - overlooking the city's main park - and its grand ballroom with capacity for 2,400 theatre-style and its12 function rooms. Singapore is the hotel's largest C&I market, followed by Hong Kong and Australia. As an alternative to the city-based hotels, groups have the option of staying at an out-of-town resort. Geared toward both the convention and incentive market is the five-star Sunway Lagoon Resort, managed by Allson International Hotels & Resorts. Set in the suburb of Sunway, built 15 years ago with its own university and medical centre 20 minutes from the Kuala Lumpur city centre, the resort encompasses a hotel, convention centre, theme park and shopping mall. The hotel provides 441 rooms and to meet demand a four-star hotel is opening at the resort in late 2002, offering a further 550 rooms and 150 serviced apartments. "Having the new hotel will allow us to bid for the large conventions because we will be able to offer up to 1,000 rooms for groups," says Sunway Lagoon Resort director of communications Mr Farizal Jaafar. The current hotel is linked directly to the resort's Pyramid Convention Centre, which has the largest ballroom in Malaysia, accommodating 3,500 theatre-style and holding 6,000 for a cocktail reception if the foyer area is used in conjunction. There are a further 43 function rooms. Mixing fun with business is an integral part of the resort's marketing strategy. "I don't think the incentive market has been tapped enough in Kuala Lumpur and we are targeting this sector now," adds Mr Jaafar. City centre hotels are also targeting the incentive market. The elegant 390-room Sheraton Imperial's restaurants are suitable for incentive groups, the property offers a ballroom which seats 1,000 theatre-style and three function rooms, the largest seating 200 theatre-style. Conference business is also a priority for the 518-room Marriott, which provides 1,000 theatre-style seating in its ballroom and 13 meeting rooms. Its location is a huge bonus. It is linked to a shopping mall heaving with designer shops and sophisticated restaurants, as well being home to the Marriott Gourmet Centre. The hotel is situated on Bintang Walk, which is the place to be seen in Kuala Lumpur. Choose between the Société Café, the House of Sundanese Food, César's Bistro and the Dome Café, alongside a multitude of shops, bars and cafés. Undoubtedly, Kuala Lumpur has a wealth of top-of-the-range hotels and high-quality convention centres, but with an ever-growing market, does supply meet demand? Destination East's Ms Vaithilingam believes that, for now, there is. "I think that Kuala Lumpur has enough facilities for the time being," she says. "Kuala Lumpur is extremely good value for money. There are flight routes from all the major airlines into Kuala Lumpur. We're also getting more of the business that was going to Indonesia originally because of the current political situation there." Asian Overland Services Ms Yap agrees political and economic situations in neighbouring countries are contributing toward Kuala Lumpur's improving business situation. "Our MICE industry has grown with events such as the Formula One and with some of our neighbouring countries not being so economically stable," she says. "And Kuala Lumpur's infrastructure is comparable to Hong Kong or Singapore's." Asian Overland Services is looking to target the Australian and New Zealand markets as well as looking into Hong Kong and India. However, there are no plans to target Japan. "We're not quite ready for the Japanese market yet," admits Ms Yap. "We need to employ a Japanese-speaking person first." Encouragingly, the standard of spoken English in the C&I industry is high. A good price, a variety of venues and accessibility are key issues for the corporate buyer and all these can be found in Kuala Lumpur. The city is marketing itself as vibrant and is dedicated to improving its infrastructure. What Kuala Lumpur must hope for now is for a revival in the fortunes of unopened hotels and continued investment in the convention centres; accelerated government promotion is the best way for the city to showcase its facilities and its C&I expertise.