The main lobby of the luxury Dhara Dhevi Hotel in Chiang Mai. The hotel has performed very well this year with an average occupancy rate of 50%, the highest since it opened 11 years ago.

Dhara Dhevi Hotel in Chiang Mai will spend at least 5.7 billion baht to expand its hotel and property business through both joint ventures and its own investment schemes.

The luxury hotel is wholly owned by SET-listed Inter Energy Corporation Plc (IFEC), which acquired it in December last year.

IFEC chief executive Sittichai Pornsupanan said Dhara Dhevi is ready to expand its hotel and property venture after completing its debt restructuring on Aug 23.

There are two new development projects.

The first is a joint venture with a SET-listed property developer to develop a six-star hotel with 80 rooms, condominium buildings with 20 units and 16 pool residences on a 40-rai plot next to Dhara Dhevi Hotel.

The joint development will cost 5 billion baht and will start construction next month and be completed in the next three years.

However, Mr Sittichai declined to name the project's partner.

Both sides have formed a joint venture whose name has not been disclosed. Dhara Dhevi holds a 49% stake with the use of the 40-rai plot as its investment.

Its partner holds the remaining 51% and is responsible for finding the project's financing.

The other project is its own development to build 14 luxury residences and two villas at a cost of 780 million baht. It is a new zone of the 155-rai Dhara Dhevi and will start construction in the fourth quarter.

Dhara Dhevi also intends to expand its bakery business by opening 3-5 shops a year.

Also on the cards is a plan to improve its spa and wellness business in partnership with an international hospital.

Mr Sittichai did not disclose the budget for Dhara Dhevi's bakery and spa and wellness business expansion, saying only that they will complement the hotel's operations.

Dhara Dhevi currently has a debt of 650 million baht which it is confident about clearing by the year-end.

This year, Dhara Dhevi Hotel targets 700 million baht in net profit. Of the total, Mr Sittichai estimated that about 600 million baht will come from its debt restructuring and the remaining 100 million baht will derive from hotel operations.

IFEC spent 2.46 billion baht to buy a 100% stake in Dhara Dhevi Hotel Chiang Mai Group, which includes Dhara Dhevi Hotel Co, A.P.K. Development Co and Dhara Dhevi Co, and its liabilities of 2.52 billion baht.

Mr Sitthichai said the Dhara Dhevi Hotel has performed very well this year with an average occupancy rate of 50%, the highest since it opened 11 years ago.

Revenue from Dhara Dhevi Hotel is expected to contribute 20% of IFEC's total revenue this year, which is projected at around 2 billion baht and the lion's share will come from the energy business.

IFEC shares closed yesterday on the Stock Exchange of Thailand at 6.60 baht, down 10 satang, in trade worth 357 million baht.