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CATHAY International Group (CIG) is hoping China will give its new hotel in Shenzhen five-star status.

    Its wholly owned subsidiary Cathay International United Investments (CIUI) yesterday held the grand opening of its self-billed five-star, 351-room Landmark Hotel in the Lowu area.

   CIG has invested a total of US$16 million in the hotel, which is worth HK$632 million, according to a recent valuation.

   Net operating profit forecast was HK$59.31 million for the year to March 31.

   Although the Landmark boasts all the luxuries of a world-class hotel, including European furnishings and a four-storey atrium lobby with marble and granite floors, it has yet to earn China's official five-star stamp.

   Gradings in China, which are not recognised by most countries, do not necessarily equate with international standards.

   A CIUI spokeswoman said the mainland's criteria were many and rigid, and did not necessarily focus on quality.

   For instance, hotels had to offer public washrooms, but there was no mandate on upkeep or sanitary conditions, she said.

   Although the opening was delayed from its original date last September so that the hotel could be upgraded to China's five-star standards, the Landmark will have to wait at least six months before it can officially claim the status.

   The government does not give its approval until hotels have been fully operational for six months to a year.

   And official recognition does not seem to have much bearing on demand. Since its soft opening in February, the Landmark has had 40 per cent occupancy. It expects this number to rise to 75 per cent in the next six months.

   The hotel represents phase two of CIUI's internal financing scheme.

   Complete refurbishing of the eight-year-old building is to be paid for by a cash-generating, six-year development project in Beijing. It includes furnished flats, office units and retail space.

   It is the second major hotel investment by a CIG subsidiary in China.

   The group's London-listed company, Cathay International Holding, injected US$30 million to take a 60 per cent interest in the 709-room Beijing Xiyuan Landmark, a 68,000-square-metre, four-star hotel, last June.

       Upon authorisation, the Landmark will be competing for a share of the Shenzhen five-star market with the Shangri-La, Sunshine and Nan Hai hotels.



Hotel to position CIG in Shenzhen five-star market