As Pattaya continues to expand, the need for accommodation, be it residential or in the hospitality sector, continues to grow in line with that demand. Rony Fineman is the CEO of the Nova Group and he has a long legacy of building hotels and condominiums, right back to when Pattaya first started to emerge as a tourist destination. Here he talks to Paul Strachan about his businesses and his passions.
Paul Strachan: Hello Rony, I have to say you are looking remarkably well and trim.
Rony Fineman: Yes, I saw a picture of myself back in December and didn’t much like what I saw. I worked hard at it and have now lost about 18kgs … and I feel much better as a result.
Nova Group CEO gives his personal outlook for the Pattaya property market.
PS: Talking about health, let’s discuss the property market in Pattaya at the moment. There is always talk about a property bubble, and now this talk is coupled with the poor exchange rates. What affect does that have on your business and perhaps how you shape your portfolio?
RF: Well, first of all we at Nova Group were very lucky when we started out – we basically had an open window. For seven or eight years there weren’t many developers in Pattaya and we were really the first, and we are still developing to this day.
I think there are some challenges that we face, the currency being one of them as the Thai baht is very strong at the moment. Another challenge is the arrival in Pattaya of many Thai developers, which is understandable as Thai people prefer to buy from Thais.
Nova Group CEO Rony Fineman.
The third and perhaps the most serious hurdle is the sheer number of projects that are out there, it seems that every second person is a developer. A lot of projects are controlled by developers who come from overseas and they are smart people. And the Thais have increased the land values, so when you add this all up, I wouldn’t say there is necessarily an over-supply but there is certainly enough.
People are not rushing in to buy like before although we still see a very strong market from Russia and emerging markets from China and India, but with the number of projects that we have, my company is being very cautious.
The Nova Group received a Highly Commended award for The Cliff condominium project at the recent Asia Pacific Property Awards in Kuala Lumpur, Malaysia.
We actually have a beautiful piece of land on Jomtien second road; we can go up forty floors and are in the process of getting the license. But at the moment I don’t feel it is the right time to launch the project, so we will shelve it until the time is right.
PS: So you have to schedule your projects according to the market?
Construction has started on Nova Group’s Serenity condominium in Wong Amat.
RF: If we launch them, I think that within the next twelve months there will be something like 28,000 – 30,000 units coming on the market and I think that will be a good test for Pattaya for the people who purchased for an investment to see if they can find tenants.
I still believe there is room for prime location projects and we see some Thai developers who can sell out in days, so obviously the Thai market is very active and very strong. And if you have a good location, you can still sell quite well, even in today’s market.
PS: Pattaya has had a huge turn around in the last ten years and is now far more a destination for families and of course Thais have now rediscovered Pattaya and realize that Pattaya has a lot to offer.
Holiday Inn Express will be coming soon to Pattaya.
RF: Yes, in the last ten years Pattaya has gone through a huge transformation. Going back twenty-six years ago, 80% of the roads here now didn’t even exist and probably 80% of the buildings as well. In the last ten years it has definitely changed its image – before it was sleazy, sex-orientated, not much to do and nothing for families. Today we see a lot of couples, families, children, it has totally changed and I think it has a long way to go.
We have two beautiful water parks coming soon, there is talk about Universal Studios, and they have opened Mimosa on top of the existing attractions, plus the new Coliseum which looks absolutely brilliant. So there is always something new for tourists, and for us in the hotel division we had our best year ever.
So I have to separate developments and tourism. The developments are one side of Pattaya, not everyone who comes here needs an apartment, and as far as tourists are concerned we reached 8 million tourists in Pattaya last year, which is amazing when you compare it to 3 million ten years ago.
PS: Let’s talk about how the Nova Group fits in with what you have been talking about. People know you as a developer but in a sense your real passion is hotels, but first can you enlighten us on your various current Pattaya projects?
RF: At the moment we have The Palm, which is my five-star project on Wongamat Beach and is 90% sold out. Construction started last year and we are up to the 28th floor now. It is due to be completed by the end of 2015. Ocean View we finished already and that is 80% sold, we have just finished The Cliff and currently have sold 92% of that development.
PS: Didn’t you just win an award for the Cliff?
RF: Actually we have won four awards in the last two years. Last year the Cliff won first place at the Thailand Property Awards and we won runner-up award in the Asia Pacific Awards in Malaysia, and it’s great to be acknowledged as part of Asia, not just Thailand.
In 2011, both Ocean View and the Cliff won awards at the Thailand Property Awards. This year we will have Amari Residences, The Palm and The Cliff in the finals for the Thailand Property Awards so we think we have another good chance to win something. Regarding other projects, Novanna will be completed in 3 months time, which is 6 months ahead of schedule and is currently 95% sold.
PS: Novanna is a bit different isn’t it, as it has a close proximity to the city center so it’s more of an urban residence?
RF: From day one my policy was not to stick with one type of project, be it luxury or inexpensive. At Nova Group we do everything, so the main thing is that when you are offered a piece of land you have to think very carefully before you decide what you are going to put on it: should it be a hotel or a residential development? And if so, what kind of project? We try to reach all markets, from the under one million baht concept, which we have done very well with, to the luxury market like The Palm and the Amari.
PS: And what about hotels? Do you consider yourself as a hotelier and a developer of hotels, and if so where does that stem from, is it your love of travel?
RF: When I was 13 years old I started work as a dish-washer in a hotel and I worked my way up very quickly and by the time I was 17 I was the night manager of the Jerusalem Hilton. Actually I still have a certificate as I was the youngest night manager for Hilton worldwide at that time, so hotels have always been my passion.
We started our hotel business in Pattaya with renting Nova Lodge and there I got very lucky. It was totally accidental as I had never thought about it in my life, but it happened. And when we opened our first project, which was Nova Mirage, actually I bought the land to build my own house it was five and a half rai. One day I was introduced to a gentleman, he was a developer from the USA and he said why don’t we develop and the deal sounded good to me so we did that and we sold out in weeks.
The first stage was Nova Mirage building A and we have never looked back since then. But as I said, my passion is hotels, I love to create them, I love to see them full and the development side gives me the finance to be able to build my hotels.
PS: So when you travel, does your mind ever stop working and when you stay at other hotels do you pick out their key points and see how you can incorporate them into your hotels?
RF: I think I keep it but I don’t write anything down. Many hotels are very similar although some have unique selling points. But when I go on holidays I really don’t think about work, I have learned to switch off my mind. Obviously I have to respond to emails etc. but when I am on holiday I am able to relax and not think about work so much.
PS: I believe you also have some property in London?
RF: Yes, we have just purchased an old pub in Edgware in London. It sits on a large piece of land and we have the opportunity and the license for 105 rooms. So we are now in the process of talking to interior designers and builders and getting the costs and bank loans etc. We hope to start work on it by the end of this year with a view to opening it in about a year and 5 months time.
PS: But why London?
RF: Well before I came to Thailand I lived in London for 9 years. I love London and England. I would say that London is the second city of my life. I go there often, in fact I just bought an apartment there. I find it fascinating in a different way to Thailand. Thailand has the weather, the people, the food and much more, but London is very sophisticated, the shows, the parks the opportunity to be in nature. I also have some family and friends there so it makes it very pleasant. I also like traveling a lot so if you have a base in London it’s very easy to fly elsewhere.
PS: So what about the Nova Hotels in Pattaya – what exactly do you have and what are your plans?
RF: At the moment we have six hotels that are open: they are the Centara Pattaya which has 230 rooms, Nova Park, Nova Gold, Amari Nova Suites, Nova Spa, which is also managed by Centara, and Nova Platinum in south Pattaya, which is managed by Amari. And this year we will start a new hotel called Nova Express which is not far from Nova Park, and we will continue with Holiday Inn Express on some land we own next to Walking Street.
We also have the Amari Residence, which is in Pratumnak and part of it will be a luxury 5-star hotel. In Bangkok we have some land on Sukhumvit Soi 15 which we have started to develop already and should be finished by the end of next year and the best one is a great piece of land we have purchased behind the Dusit Thani in Pattaya. We bought the land last year and are in the process of getting planning permission for a 25-storey hotel, this will be a 5 star hotel under the Nova brand and we will call it Nova Grand Hotel. We had many well known names such as Hyatt wanting to manage it but I decided that as it has a prime location that it should go under the Nova name.
PS: So this will become your flagship hotel?
RF: Yes exactly, and I will move my office there as well.
PS: When you return from your travels each time and you see the positive changes in Pattaya, what are the things that you think the city still needs to address?
RF: I think there are many things that need to be addressed. Speaking from Nova Group’s point of view we have big issues with the drainage system in the city. Every time it rains we see many areas being flooded and some of my buildings have underground car parks so we have now had to install flood prevention systems, which we have had to pay a lot of money for. But I think the flooding should not happen.
The roads are getting busier and will surely get worse so we need to work very hard to improve the roads. There is talk about a new high-speed train in 3-4 years time, that will also add a lot of extra traffic.
I think Pattaya should also be looking at a zoning system, for example the nightlife. I believe that Pattaya has now became a major destination for families and if they can zone off the nightlife area then the people who want it know where to go, and the families who may not want to see that will know what area to avoid.
I think in general there are a lot of things that are good in Pattaya – we have a lot of festivals a lot of things happening that attract a lot of people, not only from Bangkok but also from overseas, such as the fireworks, the music festival, but this all affects the traffic.
I also think that sometimes we see shop houses and buildings that don’t look very good on the outside. Maybe they could be sorted out in a good way with rules and regulations as to what you can and cannot put outside.
PS: Indeed, in Europe there are many rules to which you must conform, although some might say that the rules are too strict.
RF: I think if there were some control measures it would help the look of the city. I also see the problem with the beaches, the sand is disappearing. Pattaya is a beach destination so this must be sorted out. Yes, they are working on Beach Road, but that is the road not the beach itself. I think they have to fill in a lot of land and create a wider beach for the tourists to enjoy.
PS: Do you think with all the changes that we have seen taking place that Pattaya could lose its Thai-ness?
RF: We still have the crocodile farm, the snake shows, the elephant rides, Thai boxing, in fact we are involved in the Muay Thai at Mini Siam, and there is Tiffany’s also, so I don’t think we are going to lose the identity of Thailand, and of course we have the addition of world class attractions and that will bring more and more tourists.
PS: Is the low season still having an impact and what do you envisage for the next quarter?
RF: Actually we are doing quite well this low season, we have seen a pick up on the last few years and I think that we are going to have a great winter/high season this year. I think with everything that is going on in construction and entertainment wise that in the next couple of year we will reach 10 million tourists in Pattaya.
I would like to see more activity from the government to promote major attractions such as Disney and Universal, they did it in Singapore and it changed the place completely, that for me is the last piece of the puzzle for Pattaya.