|By Nondhanada Intarakomalyasut, Bangkok Post, Thailand|
Knight Ridder/Tribune Business News
May 28, 2004 - Krungthep Rimnam Ltd, a joint venture between Singapore's City Developments and the US property fund Westbrook Partners, is injecting 2.4 billion baht to transform an abandoned property along the Chao Phraya River into a five-star Millennium Hilton hotel.
City Developments and Westbrook Partners are contributing a combined 45 percent through the Thai Real Estate Restructuring Fund while the remaining 55 percent was borrowed from financial institutions, said Suchad Chiaranussati, Westbrook's managing principal.
Eight years ago, the property was destined to become a five-star hotel under Accor's Sofitel brand. When the bubble burst in 1997, the project became a high-profile casualty before being taken over by the Thai Asset Management Corporation (TAMC).
As the highest bidder, Krungthep Rimnam paid 960 million baht to the TAMC for the site and plans to invest about 1.4-1.5 billion baht to renovate it into a 542-room, 32-storey premium hotel.
The revival of the unused asset is expected to create up to 650 new jobs, said M.R. Chatumongol Sonakul, a former Bank of Thailand governor and chairman of Krungthep Rimnam.
Simon Barlow, vice-president for Asia of Hilton International, said the Millennium Hilton would position itself above riverside hotels such as the Shangri-La, Royal Orchid Sheraton and Marriott Resort & Spa, but below The Oriental Bangkok and The Peninsula.
The hotel, scheduled to open in the second quarter of next year, projects occupancy of 60-65 percent in the first year.
Mr Barlow said the hotel would focus on business and leisure travellers, as well as Mice (meetings, incentives, conventions and exhibitions) visitors.
Hilton currently operates three properties in Thailand: the Conrad Bangkok, Hilton Hua Hin Resort and Spa and Phuket Arcadia Beach Resort, which will be rebranded Hilton later this year.
Its ongoing projects include the Conrad Phuket Resort and Spa and Millennium Hilton and it is looking at Koh Samui and Chiang Mai for future developments in Thailand, said Koos Klien, president of Hilton International, Middle East and Asia Pacific.
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