In his keynote at THINC Sri Lanka & Maldives 2026 titled “Tourism Uncensored, TWC Holdings chairman Thilan Wijesinghe drew on over 20 years of experince in strategizing, building, financing and M&As in  Sri Lanka’s hotel sector. He set out what has created value in the sector, what has destroyed it and where capital is going next. This article sets out his argument for owners, investors and policymakers, with supporting data.

Sri Lanka received about 2.36 million visitors in 2025 and earned roughly US$3.2 billion from them. Average earnings per visitor are still below 2018 levels. The country attracts visitors, but it does not yet earn what its assets can command.

The economics have shifted at the top of the global market. Wijesinghe quoted Navjit Ahluwalia, formerly of Marriott and now Mandarin Oriental: "Before COVID, $1,000 a night was a ceiling for a great resort. Today it is the floor." The price at the top, Ahluwalia argued, "is now limited by how rare the product is." That idea runs through the whole of Thilan’s speech.

At a glance

• A distinctive resort can do better than its country's reputation. Ceylon Tea Trails had positive cash flow from its second year and raised rates without discounting during a civil war.

• Design and storytelling set the room rate without raising the cost per key. One east coast concept went from US$80–100 a night to US$200–250 on the strength of a reference image.

• Since 2009, Sri Lanka has built rooms without a strategy for the destination. Room volume targets, high state land pricing and beachfront high-rises have reduced the scarcity and sense of space that luxury pricing depends on.

• International brands have led the post-COVID recovery. They hold about 6% of Sri Lanka's resort supply, against at least a third across developing Asia. As such, Sri Lanka has among the lowest penetrations of internationally branded hotels – particularly resorts. 

• TWC is advising clients that new capital should go into international brands, legacy hotel joint ventures, wellness and longetivity based estates and branded residences.

A distinctive product can outperform its country's reputation

Ceylon Tea Trails began in a conversation in 2003 with Nick Clayton, Wijesinghe's mentor and freind, and was developed in partnership with the makers of Dilmah. The idea was to turn tea plantation bungalows into a small luxury resort. The result was probably a world’s first. It is a resort of five bungalows spread across about 50 square kilometres, run as one operation on a "mothership and satellite" model.

Two problems arrived together soon after opening. Wijesinghe had not set a pre-opening budget, so there was no money for marketing, and the board declined to add more. Then the civil conflict resumed.

The way out cost very little. Sri Lanka's tourist board (SLTDA) had hired Batey PR, the agency behind the Singapore Girl campaign. Wijesinghe asked the SLTDA’s chairman for one thing: every time a journalist visited Sri Lanka, could he allow them to be driven for a stay at Tea Trails. Coverage followed, because the concept was new. The resort was named among the best places in the world to propose to your partner, the top five colonial holidays and the best all-inclusive hotel. From its second year, the business had positive cash flow despite the war.

"The resort became the destination," Wijesinghe said, overriding negative perception of the country.

The lesson is simple: strategic marketing and public relations are investments in enhancing the economic value of a tourism product or destination. The government must therefore recognise that there is a substantial cost to not investing in strategic destination marketing.

Design and storytelling set the rate without raising the cost per key

Around 2010, Wijesinghe was a partner in a 100 acres beach land on the east coast. The site was then about seven hours by road from Colombo. He asked the CEO of a leading ground handler what rate a hotel there could charge. The answer was US$80 to US$100 a night. 

He then showed the same CEO an image of Nihiwatu, a remote surf resort on Sumba in Indonesia. The revised estimate was US$200 to US$250 a night. The rate more than doubled, and the cost per key stayed the same. (Actual rate charged by Nihiwatu at the time was over USD 500 per night)

This conversation taught Wijesinghe something fundamental: the value of a resort is not determined by its location alone, nor by how much it costs to build. It is determined by experiences it offers, how distinctively it is designed, and how compellingly that experience is communicated.

Building without a strategy has eroded value since 2009

After the conflict ended, the government invested in power, water and sewerage into Pasikudah on the east coast. It then approved a mix of two-, three- and five-star hotels with no shared sense of place. Today, by his account, one hotel there is bankrupt and two or three others are for sale.

Pasikudah reflects a national pattern. In Wijesinghe's view, Sri Lanka's tourism performance since 2009 has been below par. The country built product without a cohesive strategy, following the old adage of "build it and they will come", and poor policy made it worse.

Four policy choices that reduced asset value

• Volume targets. A 2010 target of 3 million tourists by 2015 was divided into a daily quota of hotel room approvals. Supply grew ahead of demand and positioning. Successive governments have made the mistake of announcing arrival targets. This is not a tourism strategy.

• Over-valuing State land. In 2012, when freehold land on the East Coast was approximately Rs. 5.5 million per acre, the government was quoting Rs. 20 million per acre for 99-year leases on comparable lands – an almost 400% premium! This matters particularly in Sri Lanka, where the state owns a substantial share of the land. Beachfront land suitable for tourism is a scarce economic resource. Government owned land should be allocated and priced in a manner that encourages the highest sustainable economic value from its use. When land is priced beyond what a high-quality resort can economically support, investors respond by reducing their development footprint, compromising the concept, or abandoning the investment altogether

• Height controls relaxed. The guideline of building no higher than a coconut tree was set aside, starting with a 12-storey resort at Weligama. That started a wave of beachfront apartments. If land suitable for a distinctive luxury resort is instead absorbed by developments that do not fit the area’s intended positioning, the opportunity to create a higher-value tourism product would be lost. This is particularly relevant to places such as Tangalle and Talpe, which have developed reputations for distinctive, low-density and high-end hospitality

International brands have led the post-COVID recovery

Only around 6% of Sri Lanka’s graded resort hotel rooms are internationally branded compared to at least 33% in tourism focused countries in Asia such as Maldives, Vietnam and Mauritius. 

The Maldives took the path of attracting ultra-high-end brands over 20 years ago. Hotels such as One & Only and Cheval Blanc spent around US$1 million a key, and local brands such as Per Aquum followed their lead. Sri Lanka has not attracted a high end international brand for 27 years – since Aman resorts opened in Galle and Tangalle

Though Sri Lanka boasts of excellent local brands, international brands can bring more robust distribution networks and loyalty programmes, global marketing, operating systems and access to customers who might otherwise not consider a destination. They can also help local investors benchmark their products against international standards.

In March this year, before the escalation of the Middle East crisis, Wijesinghe enquired about booking eight rooms at Anantara Peace Haven Tangalle. He was quoted approximately US$600 per night for a 55-square-metre room and US$1,300 for a villa. Similarly, properties such as the Marriott Weligama and Hilton Yala outperform most local brands within the competitive set in terms of rates and occupancy.

Sri Lanka’s tourism earnings have not consistently reflected the extraordinary potential of its natural and cultural assets. The strategic question according to Wijesinghe is: are we doing enough to attract investors and operators capable of helping us compete in the world’s most valuable tourism segments?

Five policy changes would protect value and release new value

Wijesinghe's first point was about method. Strategy does not mean yet another master plan. By his count, Sri Lanka has had 17 or 18 tourism master plans. He proposed five specific changes:

• Introduce zoning plans on the east coast. The east has some of the best beaches in the world. It should not repeat the mistakes made on the south coast.

• Use viability gap funding for domestic aviation. Travel time decides which location can be served served. 

• Address the underutilisation of scarce beachfront land. This is perhaps the most controversial proposal. Wijesinghe proposes a carefully designed land tax or other fiscal mechanism for suitable beachfront land that remains undeveloped for extended periods. This will apply to state agencies owning undeveloped beach land suitable for tourism. The objective should be to discourage speculative landholding that prevents productive use of a scarce resource.

• Restrict high-rise beachfront apartment developments to designated zones. High-rise developments may be appropriate in selected urban zones. It is not necessarily appropriate everywhere along our coastline. 

• Facilitate the repositioning of ageing hotels. Some of Sri Lanka’s established hotels occupy valuable sites but require substantial reinvestment to remain competitive. They should be encouraged to enter into joint ventures and rebranded, ideally involving international operators. Where aging and underperforming properties occupy state land, they must be encouraged to be repositioned with new investments. 

Two moonshots would create new demand corridors

Beyond these reforms, Wijesinghe says Sri Lanka needs to think bigger. We should identify ambitious projects capable of changing how the world perceives the country. These are mooshot projects, which require significant strategizing, planning and resources. 

1. An internationally branded luxury train. Imagine attracting an internationally recognised luxury rail operator, potentially a brand such as Orient Express, to develop a world-class train experience in Sri Lanka. The Colombo-Badulla rail track is possibly one of the world’s most picturesque train journeys rising up to over 6000 feet above sea level and is the highest track in the world in the 5½ foot gauge. We are also probably the only country the world where in under a day you can take a train to all 8 world heritage sites in Sri Lanka. What is stopping such an investment – safety. While no one has got killed in recent times in Sri Lanka due to train accidents, the railway records show many derailments caused by poor maintenance. 

2. Wijesinghe’s second moonshot is even more ambitious: to explore the possibility of bringing Formula 1 to Colombo following the successful example of Singapore. F1 wants to be in South Asia, but was discontinued in India after 2013 following commercial, tax and regulatory difficulties. We have a perfect track in Colombo stretching from Port City to Galle Face and Baladaksha Mawatha. Sri Lanka has superior logistics. This would undoubtedly be a complex undertaking, requiring substantial investment, government coordination and a long-term commercial commitment. But Sri Lanka should at least explore the opportunity, considering there is potential investment interest from India.

Capital is moving into five areas

Wijesinghe described where he invests his own money and where he advises clients, partners and boards to invest:

• Internationally branded resorts/villas. Value comes from brand recognition, distribution, service systems and guest confidence. 

• Repositioning legacy hotels. Value comes from new capital, a renewed product and better operations. The case must prove a credible target market, a fully costed renewal programme, and agreement on valuation, governance and reinvestment.

• Wellness and longevity based resorts on large land areas and estates. Value comes from tea, spice, food, nature and wellness rooted in the land. 

• Branded residences 

The underlying point is that the value of a luxury experience increasingly depends on its rarity. The world’s most discerning travellers are prepared to pay a premium for properties that offer something they cannot easily find elsewhere. Thilan claims that this principle has influenced his work over the past several years.

The finest island of its size

In 1293, Marco Polo called Sri Lanka the finest island of its size in the world. Wijesinghe is optimistic that a new wave of private equity, foreign and local capital will reshape the country's resort landscape despite past policy missteps.