Rooms from $1: Tune Hotels coming to Australia

Malaysian budget hotel chain Tune Hotels is set to enter the Australian market, promising to introduce one dollar a night offers.

Tune has already acquired a property in Melbourne and also plans to open hotels in Sydney and Perth.

Tune Hotels group chief executive officer Mark Lankester hopes to have the chain's flagship Melbourne hotel open before Christmas 2012.

He said the company had been in talks about sites in Sydney and Perth, as well as the Gold Coast, while he was also looking at Darwin and possibly Brisbane.

"Hopefully if we are welcomed with open arms by the Australian public, I'd be more than happy to do far more, and actually get my brothers and sisters in AirAsia to do more flights going in as well," Mr Lankester said.

Part of the Tune Group set up by Tony Fernandes, the head of South-East Asia's largest budget airline AirAsia, Tune Hotels follows the same model by offering a no-frills product.

It has 12 hotels - nine in Malaysia, two in Bali and one in London - with a further 54 under construction across South-East Asia.

"We've got another 14 under construction in London," Mr Lankester said.

"It's been so successful that we just want to continue there."

Tune Hotels had a one penny a night special before the opening of its first London hotel in Westminster and Mr Lankester said an offer like one dollar a night was on the cards for the Melbourne hotel.

"You bet, we'll do exactly the same thing," he said.

He said the 230-room hotel on Swanston Street would likely have an average rate of $60 to $70 a night.

Like budget airlines, the cheapest rates come from special offers and from booking online and in advance.

And the catch is you have to pay for `extra' services like air conditioning, a TV, daily room cleaning and even towels.

The rooms are small and basic, but the chain's pitch centres on having "five star beds and one star prices" and power showers.

Its first hotel, in downtown Kuala Lumpur, is set to be revamped in stages with another 101 rooms to be added on one side to take its occupancy to 275 rooms.

The writer was a guest of Tune Hotels ( and AirAsia.