THE Ambassador Hotel site, bought at the weekend for $2 billion, will become the cornerstone of Stelux Holdings' property development strategy, according to Stelux executive director Joseph Wong. The replacement building, ideally situated close to major planned shopping and recreational projects, will have a substantial retail component for rental and use by Stelux's own stores. ''Approximately 40 per cent of the floor area of the new structure will comprise the retail podium, accounting for more than 70 per cent of the building's total capital value upon completion,'' Mr Wong said. ''The rest will be Grade-A office accommodation. ''In recent years, it has been a group policy to purchase premises for our retail operations, including City Chain and Optical 88. This approach has proved extremely successful. ''We are now pursuing the next logical step by owning our own shopping complex, situated in the heart of one of the best known and most popular retail districts in Hong Kong.'' Mr Wong said that as areas adjacent to the new building underwent redevelopment, Stelux should be ideally positioned to benefit. ''It is our belief that the prospective redevelopments in the Tsim Sha Tsui area will make the southern part of Nathan Road, particularly with its excellent access to the MTR, an even more popular centre than it is already,'' he said. ''Retail tenants in this exceptional location can expect to provide favourable returns to Stelux in order for them to take advantage of the anticipated heavy shopper traffic through the area.'' Mr Wong said that in line with well-established corporate policy of pursuing long-term holdings in its property portfolio, Stelux would make the redeveloped building a flagship property. ''The building will be at the heart of our retail operations, and it is our intention to continue seeking other retail-related properties for acquisition, further building on our strengths in two of our main areas of expertise - retailing and property.''