Hotel giant stresses new broader focus
JUST building a hotel does not make economic sense anymore, according to Hongkong and Shanghai Hotels, one of the territory's leading hotel owners.
Douglas Webster, director of finance and corporate services for the hotel group, said hotels were too costly and it took too long to realise a return.
The company's future projects in Asia would include an office tower, service flats and hotel in one complex.
'I think you are going to see much more of that kind of development,' Mr Webster said.
'The idea of combining apartments, shopping, hotels and offices all mixed together will be the pattern of the future.' Mr Webster made the comments following a ceremony on the Peak to celebrate the awarding of a contract to Chun Wo Construction and Engineering Co to redevelop the Peak Tower.
Peak Tramways Co, which is owned by the group, is redeveloping the Peak Tower, Victoria flats and the upper Peak tram terminus into a multi-purpose shopping and entertainment complex.
The new Peak Tower, which will cost about $200 million to redevelop, will cover 112,000 sq ft and include seven levels of retail, restaurant and entertainment outlets.
It will be topped with a bowl-shaped structure which the developers say will provide a magnificent view of the surroundings. The project is expected to be completed next year.
In addition to the Peak project, Mr Webster said the group was actively looking at other possible sites for its hotels in Asia.
He said it was exploring two to three projects in Shanghai, involving both old and new properties.
'Shanghai is our natural home,' Mr Webster said. 'Our strategy is for us to be located in major gateway cities in Southeast Asia and Shanghai is a natural.
'But it has to be the right project at the right price in the right part of town. It's a place that we want to go back to one day.' He said the redevelopment of its flagship hotel, the Peninsula, was just about to be completed.
By the end of the year, he expected most, if not all, of the office space to be occupied, while the new hotel rooms would be in use soon.
The rooms were expected to be ready for use by October 1, with the grand opening slated for December 1.
He said the overall picture for the hotel industry was bright.
The group's occupancy rate was at about 85 per cent and the rate would be higher if bookings were not cancelled by Taiwanese tourists.