Jetwing acquires Mermaid Hotel, eyes Negombo-style revival of Kalutara

Jetwing Hotels, having acquired a majority stake in Mermaid Hotel & Club after nearly nine years as its manager, is eyeing a Negombo-style revival of Kalutara through the community -driven model it used to transform Negombo in the 1990s, a top official told Mirror Business.

The acquisition was made through Saman Villas Ltd, a Jetwing group company. It bought the majority shareholding in Kalutara Holiday Resorts (Pvt) Ltd, the owner of the 81-room beachfront hotel in Mahawaskaduwa, for an undisclosed consideration. HNB Investment Bank acted as exclusive manager and sell-side advisor to Kalutara Holiday Resorts in the transaction.

Jetwing Hotels Director of Marketing and Development Hashan Cooray said the deal came about after the hotel’s owner, Daya Ratnayake, decided to sell the property, and Jetwing took up the offer.

Outlining the group’s vision for the revival, Cooray highlighted the untapped potential of the beach town, which lies just 39 km from Colombo.

“We want to make Kalutara a more happening place. It has a very good beach and it is in close proximity to both Colombo and the airport, so the fundamentals are already there,” he noted. Cooray observed that tourism in Kalutara today is largely driven by all-inclusive packages. These keep holidaymakers confined to their hotels, with little to do outside and virtually no interaction with the surrounding community.

“Kalutara is largely an all-inclusive market, so guests tend to stay within the hotel. There are no activities for them outside and no engagement with the community, and that is what we want to change,” he stressed.

Central to that shift is the community engagement model Jetwing built in Negombo, which the group now intends to bring to Kalutara so that the benefits of tourism reach the people living around it.

“For us, hospitality has never been only about the hotel. What we did in Negombo was bring the community along with us, and that is what we want to replicate in Kalutara. Contributing to the community is what the Jetwing model is all about,” he explained.

Cooray was also candid about how far Kalutara has fallen. He pointed to the Southern Expressway as one of the factors behind its decline. Since the highway opened in 2011, holidaymakers have increasingly bypassed the coastal town on their way further down south.

“Kalutara, unfortunately, is dying. It was once a hyped destination, but today there is very little on offer for a traveller,” he remarked.

Cooray acknowledged that Jetwing was taking a risk by investing in Kalutara at this stage. He expressed confidence, however, that other hotels, guesthouses, cafés and restaurants would be encouraged to follow the group’s lead over the next three to five years.

“We are taking the risk, but we believe others will follow. We want more hotels, guesthouses and cafés to come to Kalutara, and this is not limited to Jetwing. Our hope is that by doing this, more people will come in and help create the destination,” he added.

To broaden the town’s appeal, the group intends to market Kalutara not only to its niche all-inclusive market but also to independent travellers keen to explore beyond the hotel.

“Even while we were managing the hotel, we wanted to sell Kalutara as a whole destination,” Cooray recalled.

Alongside the wider revival, Jetwing plans to add value to the property over the next 12 to 18 months and beyond, with new dining and experiential offerings planned from next year. In the mid to long term, the group also sees scope to develop the adjoining land and add rooms to the hotel.

However, Mermaid will not carry the Jetwing name straight away. The hotel currently sits within Jetwing’s Select Hotels portfolio of three-star properties that operate without the Jetwing brand. 

“It will not happen immediately, but over the next couple of years we will bring it under the Jetwing brand,” Cooray indicated.

Meanwhile, the deal brings together two properties with a shared lineage. Both Mermaid and Saman Villas in Bentota were developed by Ratnayake, whose Saman Villas opened on Christmas Day in 1995 and is widely regarded as Sri Lanka’s first boutique hotel. Jetwing took over the management of both hotels in January 2018 and later took ownership of Saman Villas, which reopened under Jetwing in October 2021. That leaves Ratnayake’s former company as the buyer of its one-time sister property.

Mermaid comprises 54 standard rooms and 27 sea-view rooms. It was singled out among 24 Jetwing properties recognised in Tripadvisor’s 2026 Travellers’ Choice Awards as a Best of the Best winner, placing it in the top one percent of listings globally