The Bangladesh Parjatan Corporation (BPC) has decided to operate some of its commercial units under public-private partnership (PPP) for maximum utilisation of the resources and increased revenue.
To this end, an official said, the BPC formed four project assessment committees last June to run three establishments and a vacant land by private investors.
The three PPP projects are Sylhet (Motel) Project, Upol (Motel) Project, Hotel Pashur (Mongla) Project and Mujgunni (Khulna) Project, a ministry official said.
The BPC has done a feasibility study to assess revenue target before awarding the assets, excepting Pashur, to investors.
But the corporation is getting a poor response as the offer amount by private investors is much lower than expected.
It has decided to go for re-tender to award at least Mujgunni (vacant land) and Sylhet Motel to private investors by the end of this year.
BPC official Ziaul Haque Hawlader said the government wants to create modern recreation and tourist facilities to attract foreigners.
But the government does not have enough funds for the purpose, he told the FE.
"We want to give these properties to private investors under PPP arrangements for maximum utilisation of our resources and maximise revenue," said Mr Hawlader.
The internal rate of return and benefit cost ratio of Sylhet Motel showed the government could earn a hefty revenue if the BPC gets Tk 100 million premium per year, he stated.
"The area of Sylhet Motel is 50-60 acres, including hill. But we can utilise only 3.0-4.0 acres," Mr Hawlader added.
"Our expectation along with land value is Tk 100 million premium per year. But bidders offer only Tk 60 million, thus compelling us to re-tender," he said.
About Mujgunni project, Mr Hawlader said the BPC's Mujgunni land still lies unused.
A stadium would be built in Khulna and the Sundarbans is already there to attract tourists. Moreover, Khulna is a vibrant city, he cited.
"The expected annual premium for Mujgunni in Khulna is Tk 130 million. But the offer amount by bidders is much lower," he said.
Upol Motel in Cox's Bazar also earns a good amount of revenue, but the state entity cannot utilise all its land and resources.
The establishment was set up in 1965 which the BPC has renovated from time to time.
Mr Hawlader said the area of Upol Motel is huge with a lake in the back and open space in the front.
According to the study, if an investor spends Tk 4.0-5.0 billion, he can earn at least Tk 250 million per month if those are of five-star standards.
"The BPC has targeted Tk 200-250 million premium per year, but the bidders offer only Tk 80 million in their expressions of interest," said Mr Zia.
The PPP project for Pashur Hotel is underway.
Welcoming the BPC's move, Journey Plus chief executive and tourism expert Taufiq Rahman said it will boost competition.
"The BPC's service quality is not up to the mark. If real private-sector tourism professionals operate hotels and motels and invest in BPC's tourism installations, service quality will improve."
Mr Rahman, however, warned that the previous experience of leasing out some BPC establishments to non-professional private-sector businesses was not good as those were given under political consideration.
Upol Motel is one of those bad examples, he said.
"The BPC must ensure that its establishments and assets are awarded to real professional tour operators and no asset is given under political consideration," Mr Rahman observed.
The BPC has 46 commercial units. Of them, 50 per cent units incur losses.
The aggregate profit was only Tk 15 million last year. But the BPC continues its expansion.
There are another five hotels and motels in the pipeline to be constructed by 2020.
The BPC leased out eight hotels and motels. It claims to have taken over all of those except bars, children's parks and some establishments.
