Destination Capital launches DESCAP1 to invest in hotels in Thailand

From left: Destination Capital CEO James A Kaplan, senior vice-president Supakit Eimsamank, and Thitiphat Thaveesin.

Destination Capital, a Bangkok-based private equity real estate investment and asset management company, on Friday announced the launch of its DESCAP 1 Private Equity Trust, which will acquire hotels in Thailand targeting investor returns of up to 15 per cent per year.

KTB Securities (Thailand) will act as settlor and trust manager and MFC Asset Management as the trustee.

The trust aims to raise Bt2.5 billion by offering an alternative asset class for investor portfolios. It will acquire freehold four-star hotels of 150-250 rooms in Bangkok, Pattaya, Hua Hin and Phuket, which are expected to rebound the quickest after Covid-19.

The investment strategy is to acquire urban and resort hotels and then renovate, reposition, and rebrand them to increase value of the properties in order to generate annual returns of 15 per cent with a 5-7 year holding period.

“The Covid-19 pandemic has significantly affected travel and tourism to Thailand, yet it also created a ‘once in lifetime’ investment opportunity in prime hotels and resorts located in well-known global destinations through DESCAP1 Private Equity Trust. It is also a way to support and rejuvenate Thai travel and tourism industry,” said Thitiphat Thaveesin, KTB Securities’ executive vice president, Corporate Finance Solutions & REIT Dept.

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