2 Shanghai hotel projects on hold

Source : Business Times - 12 Feb 2009

Developers have put two Shanghai luxury hotel projects on hold as demand for five-star hotels plummets due to the global economic crisis, Chinese media said yesterday.

The Jumeirah Han Tang Xintiandi Hotel, managed by the Dubai-based hotel chain Jumeirah Group, and the Hilton-managed Conrad Shanghai have delayed their openings, the China Business News reported, citing unnamed sources.

Construction work on the hotels, both located in Xintiandi, a ritzy downtown entertainment and residential district developed by Hong Kong property tycoon Vincent Lo, has come to a halt, the report said.

Jumeirah’s Shanghai spokeswoman Aslada Gu confirmed the opening of the chain’s hotel, originally planned for early 2009, has now been postponed to later this year.

She declined to give a reason for the delay. Hilton and Xintiandi officials were not immediately available for comment.

The Conrad Shanghai had been due to open last year.

The current economic slowdown makes it a difficult time to launch luxury hotels in China, said Damien Little, a Beijing-based hospitality consultant for Horwath Asia-Pacific.

‘In the last quarter of the year, certainly, the financial crisis began to have an impact,’ Mr Little said.

‘By the end of the year, as the market begins to recover, probably is a better time for opening,’ he said.

The average hotel occupancy ratio in Shanghai was 54.6 per cent between August and December last year, the lowest in two decades, according to Shanghai-based SAO HotelSolution Consulting Ltd.

Source : Business Times - 12 Feb 2009

Posted in General, Overseas Property | Tagged: China Property, Shanghai Property, Shanghai Hotels, Jumeirah Han Tang Xintiandi Hotel, Conrad Shanghai | No Comments »

Seoul court bars CDL hotel from evicting ex-tycoon

Posted by luxuryasiahome on February 12, 2009

A former South Korean tycoon has won a court battle to retain an office in a luxury hotel which costs him 23 US cents a day in rent, officials said on Thursday.

A Seoul appeals court rejected a request from the owner of the Millennium Seoul Hilton Hotel to stop Kim Woo-Choong - founder of the now-defunct Daewoo group - from using the top-floor office.

Before Daewoo’s collapse in 1999, Kim signed a 25-year contract with the hotel, which was then owned by one of the group’s sister firms, to use the office for 328 won (now 23 US cents) a day.

The hotel was later sold to Singapore’s CDL Group.

A lower court nullified the contract, recognising CDL Group’s claim that the office had been vacant for six years and that the tenancy caused substantial damage to the hotel’s operations.

But the appeals court on Wednesday overturned the lower court’s decision.

‘The office had been used by Kim’s wife but we don’t know whether Kim or his wife is using it now,’ a hotel spokesman told AFP, declining to say whether the CDL Group would appeal.

The Daewoo group had debts of US$82 billion when it collapsed in the wake of the East Asian financial crisis. Kim, now 72, fled the country but returned after six years.

In 2006 he was sentenced to eight and a half years in jail for embezzlement and for accounting fraud involving 20 trillion won. He was also ordered to forfeit 17.9 trillion won and pay 10 million won in fines.

A month later the jail sentence was suspended on grounds of Kim’s ill health. The ailing tycoon, who has twice undergone heart surgery, was pardoned in December 2007 in a presidential amnesty.