Regal Hotels International is considering increasing the size of the proposed float of its US hotel operations to more than US$100 million in view of the fast growing hotel business in North America, says chairman Lo Yuk-sui. The company last year revealed it intended to spin off its US hotel business for a separate listing in New York. Mr Lo said after its annual general meeting yesterday that the company had not decided on the size or details of the flotation. But it could be substantially bigger than the original planned $100 million - possibly more than doubled. As the flotation would depend largely on the company's profitability, Regal Hotels was trying to acquire more hotels to strengthen its earnings base and secure better listing terms, Mr Lo said. Regal Hotels owns equity in 27 US hotels, with a total of 7,780 rooms. Twenty-four, with 7,000 rooms, are wholly owned or majority owned. Mr Lo said Regal's North American hotels were worth about US$400 million and the company had injected equity investments of about $250 million. The network includes the 683-room Biltmore Hotel in Los Angeles, California, which the company acquired last month. Mr Lo did not disclose the purchase terms and the business performance of the hotel but said the occupancy rate was less than 70 per cent, in line with the performance of the sector on the West Coast. Last year contribution from hotel operations in the United States accounted for about 27 per cent of the group's profit before tax. He said profit contribution would increase to 30 per cent as the business and hotel network grew. Mr Lo, who is also the chairman of Regal Hotels' holding company, Paliburg Holdings, said Paliburg would resume the marketing of its property projects in the second half of this year. The residential-commercial development Fuller Gardens in Tai Po Kau Hui, Tai Po, is scheduled for sale in July. The project has a total gross floor area of about 134,200 square feet with car parking and recreational facilities. Mr Lo said Paliburg had a land bank of less than three million sq ft in Hong Kong and about two million sq ft in China under construction.
