Joanne Tang:
Hi, everyone. Welcome to Luxury Voices, the podcast about the luxury world in Asia with a focus on the greater China market. I am Joanne Tang, your host, founder and CEO of Infinite Luxury Group. In this podcast, we converse about all layers and segments of luxury, from lifestyle to travel and hospitality trends. I’ll interview key players of the luxury industry from all corners of the globe and talk about their initiatives and experiences in conquering the Asian luxury consumer, discover how leading luxury executives handle this growing market, where luxury spending is the highest in the world and gain a wealth of knowledge to harness this ever promising a luxury market.
Joining us today is Malik J Fernando, director of MJF holdings, and Dilmah Tea, which was established by Merrill J Fernando. Dilmah Tea, named after his two sons, Dilhan and Malik, was the first producer-owned tea brand offering tea picked, perfected and packed at the origin. Malik is the Managing Director of Resplendent Ceylon, the first Sri Lankan luxury resort brand. Resplendent Ceylon is developing a collection of small, luxury resorts, offering travellers a remarkable circuit across Sri Lanka, with a range of authentic experiences, while distributing to local communities and environments through the MJF Foundation and Dilmah conservation. The iconic Ceylon Tea Trails in the tea carpeted central highlands, Cape Weligama, a clifftop beach resort and Wild Coast Tented Lodge, a safari lodge, are members of Relais & Chateaux. Three more resorts are currently under development. Today, I’m speaking with Malik about the destination, Sri Lanka, the challenges and opportunities for Resplendent Ceylon and what luxury means for the travellers’ post-COVID-19 and Malik himself. It is a great pleasure to have you here on Luxury Voices, Malik. How are you and how is the family?

Malik Fernando:
We’re very well, thank you, Joanne. All in relatively dire straits, but we are optimistic about the future. That’s the main thing.

Joanne Tang:
Fantastic. Let’s dive into our conversation. Conceived by the Fernando family, Sri Lankan tea, producers and founders of Dilmah Tea, Resplendent Ceylon, a collection of small, luxury resorts offer the discerning traveller a remarkable journey across Sri Lanka, with a range of authentic experiences. Can you tell us the story of Resplendent Ceylon and the Fernando family?

Malik Fernando:
I would be delighted. It’s a story about tea, as Sri Lanka, formerly known as Ceylon and is best known for tea. My father, Merril ( who reached the age of 90 earlier this year and still very active in the business) had a dream of creating a brand. He’s currently the most senior tea taster and tea grower in active service. In the eighties, he was supplying tea in bulk to many countries around the world and he could see that his tea was being blended with many other origins and it was getting cheap. As a result, in 1988, he launched Dilmah which is now sold in over a hundred countries around the world. It’s used by a lot of the top hotels, restaurants and major international airlines.

I thought that my brother and I would be growing and selling tea all our lives, but serendipitously, I fell in love with the concept of restoring these historic tea planters’ bungalows on our tea estates, which in my view is the most beautiful part of Sri Lanka. In 2004, we took five bungalows, which we restored, keeping its original authenticity. This then became the first Relais & Chateaux establishment in Sri Lanka, and it is now the icon for boutique luxury in the country.

I call myself an accidental hotelier because I didn’t know a bit about running a hotel, all I knew was how I wanted our guests to feel. And then, when the conflict that we had in Sri Lanka ended in 2009, tourism just boomed and Tea Trails did phenomenally well. Our clientele, who are mostly from Europe, UK, Australia, US and Asia, all uniformly loved it.

Then I thought, we’re doing something right here. Our whole service ethos, founded on the whole concept of slow travel, non-cookie cutter resorts, was something to be grown further. Then, in a short space of time, we took a coconut estate that we had on the South coast, near Galle, and opened Cape Weligama in 2014. The resort is designed by a well-known architect, Lek Bunnang, and is a beautiful 39 villa and suite resort dotted around this cliff edged coconut estate. In 2017, we opened Wild Coast Tented Lodge, which is our funkiest resort in terms of design, with cocoons that look like airships in the middle of the jungle, right next to a national park that is alive with the elephant, leopard and bear.

We now have a circuit of three resorts, which we call Resplendent Ceylon. We also have a resort in development in the cultural triangle, which is the heart of our 2000-year-old civilization. You could say, it’s our version of Angkor Wat. We’re also working on two more resorts, one on the East Coast and in the capital, Colombo.
That’s how I picked up the accidental hotelier moniker because what began with tea has now grown to a family managed collection of boutique hotels. The story always delights guests because it’s a very authentic story.

Joanne Tang:
Thank you for sharing this inspiring story Malik and the belated happiest 90th birthday to Mr Fernando!

Malik Fernando:
Thank you, Joanne!

Joanne Tang:
Before we get into the core of our conversation, can you tell us what luxury means to you?

Malik Fernando:
What luxury to me is that it’s not about a status symbol or glitz, but it’s about how we make you feel. Creature comforts, which is your conventional luxury, are a basic requirement. But the new luxury is about emotional connections with people. This is what our guests rave about, the genuine warmth of Sri Lankans, the sense of discovery and interpretation. This is exemplified by the guiding that we offer at our resorts, whether it’s an interpretation of the beautiful art of Ceylon tea or the Rangers at Wild Coast Lodge explaining about leopard behaviour or the whale watching at Cape Weligama. It’s this sense of discovery, that shows what’s unique about Sri Lanka and is crafted for you in a very sort of intimate, private manner. I think for me, that’s the luxury that I aspire to and what we seek to deliver. This is what gives Sri Lanka a very optimum position. It’s not known for luxury, but the warmth of our people, the authenticity of our experiences, the beauty of the country and how we make people feel, makes us perfectly positioned for this new luxury. I believe this is going to be even more in demand as we emerge next year post-pandemic.

Joanne Tang:
I can see that the luxury that you explained and described has been included nicely into your properties.
You also talk about recovery in the year following the devastating Easter Sunday attacks, tourist arrivals in Sri Lanka stumbled. Nonetheless, Sri Lanka made a steady recovery. And by December 2019, Sri Lanka tourism has rebounded. Just as the hospitality industry was getting back on its feet, the COVID-19 pandemic struck. By March 2020, the number of international tourist arrivals in Sri Lanka had declined by 70% in comparison to a year ago. Sri Lanka tourism very much depends on international markets. So how did COVID-19 impact Resplendent Ceylon?

Malik Fernando:
If you look at the Easter Sunday attacks, which seems like a distant memory now, that was an absolute outlier. We knew it was a one-off and people felt more secure a few months late as soon as security was ramped up. Then business came back, as you said, and by December of 2019, we were virtually back to where we were before. We had an excellent quarter from December through to March, and we were looking forward to a great 2020, but COVID has been far more devastating. It’s impacted all our markets, as well as domestic tourism because of the restrictions that have been in place.

All things considered; Sri Lanka has handled this situation pretty well. The whole country shut down in early March for almost a month and a half. We’ve had a total of 13 deaths as a result of the pandemic thus far and, as a result, it’s built up a reputation as a very desirable destination to come to post COVID. But the domestic business, it’s not a big market, and, particularly at our positioning, it is unaffordable for many. But many Lankans who would travel overseas on holiday have been forced to travel at home. They heard about our resorts, but they never expected the kind of pampering and the kind of experiences we offer. So, it’s been a wonderful eye-opener for many of the higher-end travellers in this country who’ve been forced to travel within our borders. That means it bodes well going forward that we should have from previously, maybe a four or 5% domestic clientele, it could go up as high as 15 and maybe 30% in the so-called quieter periods when we have fewer foreign travellers. Therefore, it’s been positive in terms of forcing us to attract domestic business and domestic travellers being forced to look at properties within the country, but it hasn’t covered our bottom line, so it’s been pretty awful from a financial standpoint.

Joanne Tang:
Hopefully, the travel restrictions and borders reopen very soon so we can all resume our businesses. Countries in Asia seem to have managed the pandemic quite efficiently as we move towards a path of recovery. How important do you think the Asian markets will be for your hotels?

Malik Fernando:
The Asian markets are critical. Typically, Sri Lanka has been a more Western market in terms of long-haul travel in the past, but in the last 10 years or so Asian travellers have discovered this country. India and China are critical and we’ve had significant growth in regional markets. It’s all short-haul, medium-haul and no transits flights, so that’s going to be desirable post-pandemic. Sri Lankan airlines also have a lot of frequencies to India and China. There’s also the seasonality. It levels out the so-called “off-season” that we used to have, and it’s terrific to see regional Asian travellers levelling out the seasonality.

Sri Lanka is also an undiscovered dream. It’s raw and fresh in comparison to many other Asian destinations. The variety in this country is vast. It’s six or seven countries in one, it’s almost like a continent. As you travel around the country, though it’s very small, you get so many different ecosystems.

Joanne Tang:
I fully agree with you about the Asian market, being a regional market for you to assess stability. The different seasonality that compliments the long-haul markets, as Sri Lanka is a very up and coming destination for the Asian travellers, as you said, an undiscovered dream.

Malik Fernando:
It is. The fact that we emerged after a period of conflict meant that we didn’t have the rampant development that many other destinations have had. So, it’s just about 10 years since Sri Lanka came out of its shell and it hasn’t been overdeveloped. You’ve got wonderful zones within the country that haven’t been touched for decades and that’s what the modern traveller likes. You feel that you’re discovering the pristine-ness that Sri Lanka affords and that I think is going to be in huge demand, post-pandemic.