Government investment firm considering building two office blocks in city centre instead
The Guangzhou city government's listed investment unit, Guangzhou Investment, is mulling plans to scrap a hotel tower in its stalled multibillion-dollar property development in the city centre and build more office space instead.
Sources said the developer was now considering changes to the complex that would see two office towers rising above a retail complex, instead of one office tower and one hotel tower.
If the conversion is approved by the government it will dash the hopes of European hotelier Accor that has been waiting to exercise a management contract already signed with Guangzhou Investment to establish its first luxury brand Sofitel hotel.
For now, Accor is pinning its hopes on the hotel plan proceeding despite signals that the developer aims to apply for a change to planning approvals.
'We have seen construction of some hotels slow in the city in the past six months because of tightening of credit. But we still have the management contract to run a Sofitel hotel [in the complex],' Accor senior vice-president for Greater China Robert Murray said yesterday.