Sinyi's RM1bil hotel bet puts Sabah's Papar on the map

KUALA LUMPUR: Taiwan-based Sinyi Group is investing RM1 billion in Sabah's hospitality sector, with its InterContinental Sabah Kota Kinabalu Resort in Papar scheduled to open in December 2027 as the state sees continued growth in visitor arrivals.

Developed in partnership with IHG Hotels & Resorts (operating partner), the resort in Melinsung spans more than 32.4 hectares and will be Papar's first five-star hotel.

The main hotel, comprising 418 rooms and accommodation units, is targeted to open in December 2027, followed by the wider resort in 2028.

Papar Member of Parliament Datuk Armizan Mohd Ali said overall construction progress stood at 34.1 per cent as of September 2026, while the main hotel had reached 47.7 per cent completion, based on a briefing by the developer.

The project is expected to create about 700 jobs upon completion, while generating economic spillovers for local businesses in food, transport, supply and tourism services, Armizan said.

"My hope from the beginning has been for this investment to deliver benefits beyond the development of a resort. It should create jobs for local people and generate economic spillovers for food, transport, supply and tourism service operators in Papar," he said, according to Bernama.

Beyond the resort, Sinyi has pledged to spend the next 10 years restoring coral reefs, protecting turtle nesting areas and planting trees on Sabah's Mengalum Island, as part of its more than RM1 billion investment in Sabah.

Mengalum Island, about 56km north-west of Kota Kinabalu, is known for its beaches, clear waters and coral reefs.

Sinyi is reported to have acquired about 300ha on the island in 2019 and plans to develop a low-density luxury resort, with about 95 per cent of its electricity expected to come from solar power supported by battery storage systems.

Sinyi Realty Malaysia assistant general manager Henry Chou said at a recent investment conference on sustainable development that Sabah remained attractive to investors despite challenges including shortages of construction materials and technical expertise.

The investment comes as Sabah's tourism market continues to expand, although the growth is also adding to the pipeline of hotel rooms.

Sabah recorded 3.79 million visitor arrivals in 2025, up 20.5 per cent from 2024, generating RM8.74 billion in tourism receipts.

China was the state's largest international source market with 657,528 arrivals, followed by Brunei, South Korea and Indonesia.

Visitor arrivals continued to increase in 2026, reaching 2.24 million from January to July, up 5.6 per cent from the same period a year earlier. Sabah is targeting four million arrivals for the full year.

Olive Tree Property Consultants property consultant Samuel Tan said the increase provided a positive demand backdrop for hotels targeting international leisure travellers, domestic holidaymakers and business visitors.

However, the market is also facing a growing pipeline of new rooms, including international-branded properties and hotel conversions, he told NST Property.

IHG is expanding its Sabah presence through a two-hotel agreement with King Park Hotel Sdn Bhd, a subsidiary of Miri-based, privately owned, Hass Enterprise Sdn Bhd.

The agreement marks IHG's entry into Malaysia's franchise market and the debut of its Garner midscale conversion brand in the country.

The 202-room Garner Hotel Kota Kinabalu will be converted from King Park Hotel Kota Kinabalu, with 106 rooms scheduled to open in 2027 and the remaining 96 rooms in 2029.

The 140-room Holiday Inn Express Tawau is scheduled to open in 2028 after refurbishment of the existing King Park Hotel Tawau, marking IHG's first property in Tawau.

The additions will increase IHG's open and pipeline presence in Kota Kinabalu from one to five hotels, while establishing its first presence in Tawau.