The Hon Kwok Leighton Centre in Causeway Bay will be transformed into a three or four-star hotel with more than 300 rooms to cater for Asian budget travellers, according to its new owner, Chan Siu-kit. New Far East Economy Development (NFE) recently bought the building for $861 million from Hon Kwok Land Investment. Mr Chan, president of NFE, an investment and trading concern, said he decided to purchase the vacant 25-storey building because his company was looking for a long-term property investment. 'We plan on going public,' he said, 'and we are looking for a property to provide us with a long-term investment.' Property agents said Mr Chan's company had a large portfolio of properties in Hong Kong, including space in the Lippo Centre in Admiralty, Harcourt House and the Convention Plaza in Wan Chai. Mr Chan said his group's mainland and Hong Kong backers wanted to acquire more local property. Agents said the Hon Kwok Leighton Centre originally was put up for sale on a floor-by-floor basis. However, Mr Chan said he became convinced he should buy the entire 125,000 square foot office property when he found out by chance that the site was zoned for both commercial and hotel use. 'The original owners were going to put a hotel on the site,' said Mr Chan. 'But when Hon Kwok bought the site they decided to put up an office building.' Hong Kong-born Mr Chan said he planned to transform the office building into a three or four-star hotel to meet the needs of Southeast Asian tourists coming to Hong Kong. 'Causeway Bay is a very popular place to shop for these tourists but there are only three or four hotels in the area they can afford to stay in,' he said. He said mainland visitors would probably be the single largest group of people to stay in his hotel. Mr Chan said his research showed this type of hotel would be a welcome addition to Hong Kong since so many of the budget hotels that used to exist a few years ago had been torn down or converted into office space. He said there were only about 25 three or four-star hotels in Hong Kong providing about 12,440 rooms for budget travellers. Besides many mainland Chinese visitors, Mr Chan said he expected to get a lot of business from Taiwanese and Indonesian travellers. 'Most of these travellers stay in three or four-star hotels which cost around $1,000 per night,' he said. Mr Chan said the company would probably spend about $1 million on modifications to the building. Since buying the building he had been approached by many hotel management companies keen to run the hotel for him. The company also had the right to add more floors to the building, he said. Mr Chan said no name had so far been chosen for the hotel, which is expected to open for business by the middle of next year.