AZM Anas

The parent of Dhaka Sheraton has intensified lobbying the government for a long-term contract as the current deal on running the country's one of the upscale hotels ends next month.

The Starwood Hotels and Resorts Worldwide, which has been managing Bangladesh's oldest five-star hotel for 25 years, will begin talks with the owner early next month as it will look at the renovation work and operation of the government-owned hotel.

"We're looking at negotiations for refurbishment and long-term contract, may be for five years with a potential extension of another five years," Trevor MacDonald, General Manager with Dhaka Sheraton, told the FE last week.

Starwood has been managing the state-owned hotel since 1984 under the brand name of Sheraton chain, but the contract ended in December last year.

But officials said a sharp disagreement over the process of renovation prompted the government to invite international tender for operator selection.

Bangladesh Services Limited (BSL), the government agency responsible for overseeing the posh hotel, floated international tenders twice to find a suitable company for managing Dhaka Sheraton.

The company received six offers in the second round of bidding and asked the Swiss hotel chain Golden Tulip and Turkish Ramada Plaza to submit financial offers after concluding technical evaluation.

But no date is yet fixed to open the financial offerings.

MacDonald said a high-powered Starwood delegation would arrive early next month to have talks with the government for the possible contract.

The government would not ditch talks with Starwood as part of its intention to retain the present operator of the country's oldest five-star hotel, Civil Aviation and Tourism Ministry Secretary Hedayetullah Al-Mamun said in a recent interview.

Sheraton proposed to close down the hotel for two years and go for massive refurbishment at a cost of Tk 2.0 billion.

However, BSL wanted to get the renovation work done in phases and keep the costs within Tk 800 million, not the amount quoted by the hotel authorities.

"Now, we agreed to keep the hotel open while continuing the renovation work. But that is also a key part of the forthcoming discussion," the Sheraton top official said.

On Starwood's further appointment, its oppo nents say if the global chain is inducted again, it would "divert businesses to a new 5-star hotel," jeopardising Sheraton's existence.

Starwood, which operates hotel businesses across the world under nine brands including Sheraton and Westin, has a business deal and equity stakes in a new five-star hotel, Westin Dhaka, according to persons who closely follow Bangladesh's booming hospitality sector.

On the other hand, Starwood's allies say Golden Tulip has a history of losses in most of its global operations while Ramada has no experience in running a five-star hotel.

Golden Tulip, which runs nearly 800 hotels in 50 countries, and Turkish chain Ramada Plaza became technically qualified for Sheraton contract, outbidding four contenders.

Sheraton has already managed to obtain the extension of the contract up to June 30 this year.

"Our group is very interested in managing the hotel. In fact, we're an icon," the Starwood official said.

Dhaka Sheraton's business has suffered a serious blow in recent years as it faced stiff competition from newer rivals, notably Westin and Radisson.