Cokaliong buys 9th vessel, building 12-story hotel
Cokaliong Shipping Lines Inc. recently invested $2 million to acquire its ninth vessel from Japan in order to tap a demand for island transport in major ports of the Visayas and Mindanao.
The company is also building a 12-story business hotel, a first for the Cokaliong Group, in the North Reclamation Area of Cebu City.
Chester Cokaliong, founder and CEO of the company, said he wanted to tap a demand from passengers in major ports like Cagayan de Oro and Nasipit in Agusan del Norte.
The vessel with an estimated gross tonnage of 3,000 tons has a cruising speed of 15 knots and will be delivered to Cebu by the last week of November or first week of December.
“The vessel, which is named MV Ferry Nakagara, is actually a sister vessel of MV Filipinas Iligan, which we bought last year. It has the same features and exactly the same layout but is four years younger than MV Filipinas Iligan,” said Cokaliong in an interview this week.
The new vessel has four engines and three auxilliary engines with a capacity of about 850 passengers.
It will operate by end of February or the first week of March next year according to Cokaliong.
SHIFT TO CARGO
He said they continue to invest in the industry after seeing a revitalized passenger market in major ports in Visayas and Mindanao.
“Major ports, which have now become feasible, are Cagayan de Oro City and Nasipit, Agusan del Norte. This was brought about after two major shipping companies—Carlos A. Gothong Lines and Gothong Southern Shipping, Lines—decided to stop serving passengers and instead focused on cargo shipping,” said Cokaliong.
The shift was an offshoot of a new policy of the Maritime Industry Authority (Marina) to suspend a company’s entire fleet if one of its vessels meets an accident.
As a serious player in the passenger liner business, Cokaliong said he is asking Marina not to “crucify” shipping companies this way.
If more companies shift to cargo because of the high risk in passenger shipping, Cokaliong said the remaining passenger shipping lines will have a bigger pie to share.
“That is why we really bought the vessel a year after we have bought MV Filipinas Iligan,” said Cokaliong.
Cokaliong adds vessels to its fleet every two years.
In 2007 he bought MV Filipinas Cebu for P220 million, then acquired MV Filipinas Ozamiz in 2009 for P250 million and in MV Filipinas Iligan in 2011.
Two major ports that used to be serviced by two Gothong shipping companies are underserved—Cagayan de Oro and Nasipit in Agusan del Norte province—but Cokaliong said he hasn’t decided yet which port to serve.
He said he is looking at several potential ports and will decide next year when MV Ferry Nakagara is ready.
At present, Cokaliong serves 12 ports—barangay Maguinoo in Calbayog in Western Samar, Cebu, Dapitan, Dumaguete, Iligan, Iloilo, Maasin, Naval, Ozamis, Palompon, Surigao and Tagbilaran.
Based on data provided from the National Economic Development Authority, Central Visayas posted a 10.5 percent increase in the number of ship calls with 70,224 trips in the first half of 2011.
Passenger traffic increased by 4.5 percent with 6.1 million in the first half of last year compared to only 5.8 million in the same period of 2010 with most traffic registered in the months of April, May and June.
Cokaliong said that he remains confident that shipping will continue to expand because of the booming tourism industry.
Budget airlines that offer low airfares don’t pose a threat, he said.
“Travel by sea will remain the cheapest mode of transportation and will always be a preferred mode by most Filipinos because the Philippines is an ‘archipelagic’ country,” said Cokaliong.
Cokaliong is also building the 12-story Cebu Bay Front Hotel at the North Reclamation Area beside the Cebu Daily News’ building.
The proposed hotel will be finished in 2014.
“We just started construction last month and we’re looking at a two-year completion time. The hotel will have 150 rooms and will be operated as a business hotel,” said Cokaliong.
The property, a first under the Cokaliong Group, will complement its shipping business.
“We have a lot of group tours that we cater to in the shipping business and we just refer them to hotels for accommodation. With our hotel operational in 2014, we will then have a facility to host tour groups when they come to visit Cebu,” said Cokaliong.
Cokaliong said the hotel will be managed by the family-owned company although some hotel management companies have approached them offering their services.
“Right now that is what we have decided. We will manage it and it will be under a separate company under Cokaliong Group,” said Cokaliong.
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