Overcoming the wellness handicap

Sri Lanka’s first wellness resort’s positioning, its promoters say, overcomes the island’s handicap of not being a luxury travel destination

The nuclear bunker-like stark design of a new mountain top resort is a key part of its attraction, positioning it at the vanguard of one of the fastest growing segments in the leisure sector – wellness tourism, according to its founder.

The resort, Santani’s unadorned concrete walls, polished cement floors and reclaimed wood furniture’s minimalism blends with the surrounding hillside, savannah grass and forest. Spread across a 48-acre abandoned tea estate outside Teldeniya, in the hills northeast of Kandy, Santani’s stark minimalism helps visitors disconnect from the outside world.

“Guests have a framed view of the lush greenery from the rooms, and naturally they slow down,” points out Santani’s founder Vickum Nawagamuwage referring to the view from the resort’s 20 mountain slope rooms, raised from the ground and kept level on stilts. Minimalist furniture, interior austerity and the view of the opposing mountain from the glass frontage leads Nawagamuwage to claim that the design mimics meditative caves. The contribution of the resort’s setting and architecture to the feeling of ‘slowing down’ is a critical element of Santani’s strategy.

For Nawagamuwage, the location of the resort – which started accepting its first guests in late 2016 – was key. “You can get a massage anywhere in the world, that’s not a differentiator. What we created was a setting that is way beyond any of the competition globally.”

The idea that human beings can improve themselves – in mind, body or spirit – has been an enduring one. Religions and cults urged followers to grand spiritual aims and the affluence-spread idea that upliftment can be achieved with money in an allotted parcel of time is taking hold. These aims fit aspirations of a back to nature class – ones whose material needs are fulfilled – focused on shedding unnecessary stuff like clutter, impure thoughts and body fat. Stresses of modern life – like a rising career arc, keeping envy in check when neighbours unveil riling new acquisitions and sacrificing precious hours set aside for enjoyment for domestic crises – will challenge even those with the most serene of outlooks. Naturally, the affluent feel their lives are ‘out of balance’. Capitalising on this creeping feeling of doom is the wellness industry, claiming it can assist them reach emotional and physical equilibrium.

Wellness, the segment in tourism Santani is positioned to cater to, is a category that has emerged in the last two decades, consolidating many sub-categories including traditional and alternative medicine, spas, spirituality, nutrition and fitness. Wellness fits well with the demands of its rich, busy and often stressed-out customers for a holistic approach.

Depending on how guests feel about themselves and their demands, a stay at a wellness resort can range from fitness boot camp, a meditative pilgrimage or a roving therapy session.

In the last decade, hotels that specialised in only one or two of these areas have responded to market pressure by broadening their business offering. Even storied Asian luxury hotel chains like Aman Resorts have made wellness, including traditional Chinese medicine and Ayurveda, part of their offering.

Building expertise to operate in several different areas of the market is one difficulty for wellness and Santani in particular because the quality of professionals it seeks aren’t available here. The other challenge is credibility; are modern wellness resort’s treatments grounded in science or snake oil?

Wellness demand is healthy and widespread among the affluent, an indication that this is more than a nonsensical fad. An appeal of wellness may also be that resorts, from the gut-cleansing schedule, spa treatments and food menu, plan all activity. Wellness is the ultimate feeling of helplessness in extreme luxury for those who can afford it. All guests do is pack a bathing suit, running shoes and yoga pants.

Wellness’ global success may also be down to its combining effectively two obsessions of the wealthy, luxury with new age treatments. Ahead of the large luxury chains entering wellness were purpose-built resorts that pioneered the concept of a holistic approach.

Santani’s founder Vickum Nawagamuwage realised early that he couldn’t compete with global resorts on wellness alone, and devised a new strategy for wellness in Sri Lanka

Bali’s Ubud region concentrates some of the world’s top luxury and middle market wellness brands. At the top are resorts like Como Shambhala, Five Elements, and wellness resorts like Four Seasons and Six Senses that are priced at around $1,000-2,000 a night. At mid-level are the $300-400 resorts like Yoga Barn.

In the rest of Asia, brands like Thailand’s Chiva-Som and India’s Ananda in the Himalaya have built brands to rival western pioneers.

Santani – meaning ‘in harmony with’ in Sanskrit – competes with Ubud’s top resorts and Asia’s best to attract visitors. Nawagamuwage realised early that he couldn’t compete with these resorts on wellness alone. “So I had to figure how else to compete.”

Wellness resorts are generally opulent, defined by extensive manicured gardens, high ceilinged entrance halls and spacious well-equipped rooms. Nawagamuwage – having himself been a regular at such resorts during his strategy consulting stint in the US and Asia for a big four accounting firm – understood Sri Lanka’s lack of reputation as a wellness destination, in addition to his not having much capital.

Santani has a three-pronged strategy to stand out in the midst of global competitors, according to Nawagamuwage – setting and architecture, a deeper understanding of Ayurveda and integrating these into wellness, and a unique gastronomy that supports health. Nawagamuwage, a former strategy consultant, describes this strategy as Wellness 2.0.

The wellness segment’s annual growth tops 12% globally – driven by a rich clientele willing to pay as much as $3,000 a night and stay for up to two weeks in a resort – compared to 5% annual growth in global tourism overall. Explosive demand has reveled an unprecedented opportunity for expansion and for new entrants to wiggle their way in. Santiani’s strategy blunts disadvantages, accentuates strengths and competes head-on on everything else to create what Nawagamuwage claims is a new generation wellness product.

Lack of capital to build the sort of resort with creature comforts for guests was the first challenge he overcame by choosing the stunning setting and minimalist design, which made austere construction possible. Ubud, Nawagamuwage says, is a tiny village; “We have thousands of such places with better vistas when we go to an elevation of 2,000-3,000 feet above sea level.”

Santani has a three-pronged strategy to stand out among global competitors – setting and architecture, a deeper understanding of Ayurveda and integrating these into wellness, and a unique gastronomy that supports health

The perfect location for Santani took a year and a half to find. During this time, Nawagamuwage was a founding member of Singaporean Regenetec – an urban wellness studio with a focus on stem cell treatments, where he was interim CFO for a year. His criteria to meet on the site were that it had to be easily accessible, but still far away from everything else. “Because people aren’t coming here to see more people.”

Operational costs across hotels offering the same quality of service and luxury are similar. High return on equity is often determined more by the cost of construction or refurbishment than operating costs. Some of Sri Lanka’s top luxury hotels that offer their cheapest rooms at $400 a night or more are estimated to have spent upwards of $300,000 on average construction per room (cost per key), going up to $500,000 at some exclusive properties.

Santani’s business plans called for $400 a night pricing, having spent $150,000 average on the 20 rooms it constructed. However, two months after launch, the trickle of guests is charged $600 a night. “The issue is in building costs and the selling price. That’s where you need to juggle with the numbers and make sure you get it right.” Overall, Santani – with its vast acreage, main building and restaurant, pool, spa, 20 rooms and other infrastructure – has cost over $3.7 million raised from promoters, Nawagamuwage, a Dubai-based family member and a $2 million bank loan.

Inexperienced developers often overspend on construction, later discovering that their Revenue Per Available Room (RevPAR) doesn’t generate reasonable ROI. By opting for the stark, minimalist and avant-garde design, Santani minimised construction and operating costs. The simplicity of geometric design, unadorned spaces and exposed concrete significantly reduced construction and interior decoration costs. Since the site is 2,800 feet above sea level, it does not require air conditioning, even in the rooms. “Metaphorically, to have the ability to lay by the pool in a bikini is important to relax and in the evening, it’s cool enough to get under the duvet,” muses Nawagamuwage. Air conditioning accounts for 70% of energy use at any hotel that uses it.

Its architect Thisara Thanapathy has focused on creating an aesthetic that’s avant-garde and not in the mold of Geoffrey Bawa-associated topical modernism. Contrasting opulent international wellness resorts, Santani averts from stimulations, vivid colours and hightech gadgets. “Plunge pools and flat screen TVs don’t add value to someone paying $700-1,000 a night because they have material luxuries in their everyday life. What these travelers seek is the luxury of peace and quiet,” he explains.

Until the latter part of the last century, only the rich could afford vacations, and these were often bound with the idea of health. Slow transport meant travel was time consuming, and as a result vacations were fewer. But when they did holiday at spa towns away from dirty cities, they would spend weeks if not months. Much later, white collar and blue collar workers democratised the concept of vacations. Pleasure-focused hotels replaced improving health outcomes, as more people took shorter but more frequent breaks.

Santani’s strategy blunts disadvantages, accentuates strengths and competes head-on on everything else

The industry is now coming full circle to improving health as an outcome, at least for the rich who can afford such vacations.

At modern wellness resorts, guests typically pick packages ranging in duration from 7 to 14 days, with goals in mind. These can include general outcomes like weight loss and fitness, or holistic outcomes around preventive care, spiritual upliftment and relaxation. The modern wellness resurgence was led by the popularity of yoga in the US and Europe over the last three decades.

While Santani’s rarefied views blunt Sri Lanka being an outsider among the Asian wellness elite, its focus on Ayurveda accentuates a Lankan advantage. Ayurveda has an icky reputation, for its treatments oils’ unpleasant smell and distaste of orally administered medicines. “People assume Ayurveda is wellness and everyone who has a spa tags wellness with that. That is not what we are. Proper integrated wellness means you are coming for a 7-14 day programme with specific goals in mind.”

Sri Lanka’s Ayurveda heritage is as extensive as it is storied. Legend – as told in the Ramayana – has it that Laksahmana, an avatar of a God, having forgotten which medicinal plant he was asked to fetch from India, brought a whole mountain and dropped it in Sri Lanka. Ayurveda, combined with mindfulness that forms the island’s Buddhist heritage, is the second area of Santani’s differentiation.

Ayurveda is the origin of what is happening in the wellness space.“They don’t necessarily associate it back to Ayurveda, but that’s genesis,” contends Nawagamuwage. During the last couple of years, Nawagamuwage has discovered nuances around Ayurveda’s approach to wellness that altered his view of its primacy to modern wellness.

Ayurveda comprises two key areas called shamana and shodhana, he says. Shamana is about taking care of symptoms, allowing the immune system to do the repairing. But Ayurveda has a second, deeper level called shodhana, meaning cleansing of the system, which addresses existing medical concerns and adds preventative treatment. Ayurveda massages and treatments push toxins stuck in the body into the digestive system, which is then cleansed through natural laxatives and enemas. Massages aren’t designed to pamper. Done properly, they take care of issues and adjust the muscles.

“Repetitive action and injuries misalign muscles. Massages can address this and release the bad stuff like toxins stuck in myofascial tissues. But people don’t understand it from that point of view.”

Santani offers five packages targeting different wellness outcomes: Ayurveda, detox, healthy living, yoga and one addressing stress. They evaluate guests’ mental habits, eating habits and their goals before tailoring a programme involving the resort’s multiple wellness treatment options. Its spa employs eight therapists for a property with 20 rooms that can occupy 40 guests. During the first year, Santani budgets 30% occupancy.

The intensity of Ayurveda in a Santani wellness treatment depends on guests’ chosen programme. Often, a guest on a seven-day package will be prepared through an altering diet, activity and treatments for a detox on the fourth or fifth day of a stay. They start by restricting meats and gradually transferring to a vegetarian diet. In the couple of days following the detox, they introduce plenty of rejuvenating treatments, and reintroduce meats into the diet.

Pre-launch, Santani’s core team spent some months outlining the finer points of its differentiation. It was apparent by this point that the resort’s setting was going to be its major draw, and experiments around the potential menu centered on it being uniquely Sri Lankan inspired.

Santani’s food philosophy is based on multiple factors: an individual’s body type and condition, their diet, and the wellness outcome targeted during their stay. He was keen they don’t sacrifice the pleasures of gastronomy like regimented vegetarian diets have done to most wellness resorts. Santani didn’t want to deprive its guests and it was Chef Vajira Gamage’s responsibility to ensure this.

Nawagamuwage says he wanted to create a fine dining but healthy menu based on something local. We need to be able to talk about the Ramayana situation when we talk about the food, he says about the challenge he extended to chef Gamage – formerly of Resplendent Ceylon (the holding company of Tea Trails and Cape Weligama). Gamage scoured Sri Lanka’s culinary heritage, creating low-carb, seven-course meals, which are gastronomic journeys. All this is out there, it’s just that people are not aware of it, Nawagamuwage says of chef Vajira Gamage’s work.

Seventy percent of Sri Lanka’s hotel rooms are located along the island’s South-Western coast. Despite a two decade-long debate about the need to move beyond the brand positioning around ‘sun, sea and sand’, it’s the only brand identified with the island’s tourism. Nawagamuwage identifies two asset classes Sri Lanka posses that can be globally competitive. The first is logistics, which exploits Sri Lanka’s advantageous location at the crossroads of busy shipping routes. Second is tourism, according to Nawagamuwage – who, during his strategy consultancy years, was part of a team that worked on Malaysia’s long-term growth strategy.

In the league of pristine, golden sand beaches, Sri Lanka is only a second-rate destination compared to coastal heavyweights Thailand and the Maldives. “I was lucky because I’m not from the industry, so I didn’t have any baggage. I was open to a lot of things; and being a strategy consultant, I was able to think critically about all the opportunities rather than wishfully,” Vickum Nawagamuwage says.

“People assume Ayurveda is wellness and everyone who has a spa tags wellness with that. That is not what we are.” Nawagamuwage

His motivation is to build a world-class luxury brand out of Sri Lanka. Many global luxury leisure brands have emerged during South East Asia’s tourism boom, a scenario he thinks will now play out in Sri Lanka. It is one of two countries in Asia-Pacific where the average daily and revenue per available room is growing.

Nawagamuwage thinks Sri Lanka can learn from Thailand’s tourism success. “We have a better product than Thailand in almost 90% of the areas,” he says.

He says the top 10 tourism-generating markets are mostly similar to Sri Lanka. However, overall, Thailand attracts at least 20 million vacationers annually versus a tenth of that for Sri Lanka.

Santani’s strategy is a microcosm of what Sri Lanka’s national tourism strategy should be, according to Nawagamuwage. He believes Sri Lanka’s grand attractions inland can be highlights. “If Cambodia can get five million people just to see Angkor Wat, we can easily get that number to Sigiriya, Dambulla, Polonnaruwa and Anuradhapura combined as one grand attraction. It’s a cluster there. And some of the best wildlife outside of Africa is in Sri Lanka.”

Wellness may not become a mainstay of tourist arrivals here, but luxury can. Already some higher end brands are entering the market and Aman Resorts – one of the region’s most phenomenal successes – has been here for more than a decade. Some entrepreneurial zeal could see the rise of Sri Lankan brands too.

Greater awareness and sensitivity about health and the rise of luxury tourism in the region will continue to grow the wellness segment too. Stressed-out consumers willingly spend to restore their health and find the ‘balance’ in life they crave.