A Second Chance

New Plans for the Ill-Fated "Sofitel"

The Nation (Bangkok), May 28, 2004

Hilton to run riverside hotel
Published on May 28, 2004

A new luxury hotel is due to open by the Chao Phya river in the first half of next year. Owned by a US property fund and a Hong Kong developer, it will be managed by the Hilton group.

The "Millennium Hilton Bangkok" is being set up by the Thailand Property Restructure Fund 1, a 50/50 property fund formed in January by Westbrook Partners and City Development Co.

The fund, managed by One Asset Management and worth some Bt956 million, has been buying into Thai properties cheaply from financially troubled owners.

Two months ago, it bought a condominium building formerly belonging to CP Land and Univest Group from the Thai Asset Management Corp.

The plan to turn the condo block into a luxury hotel was unveiled yesterday.

Former Bank of Thailand governor MR Chatu Mongol Sonakul is chairman of Krungthep Rimnam, a new company set up specifically to operate the building.

"We need Bt1.5 billion more for partial construction and renovation and that will be financed through a syndicated loan from Kasikornbank, Bank of Ayudhya, Siam City Bank, Tisco Finance and Ayudhya Investment and Trust," Chatu Mongol said.

The hotel is slated for opening in the second quarter of 2005, he added.

Westbrook Partners manages assets worth US$15.2 billion (Bt618 billion) worldwide. City Development is the second-largest land developer in Hong Kong.

The hotel is Westbrook's second investment in Thailand. It has also purchased a 37-per-cent stake in Amarin Plaza, which owns the Grand Hyatt Erawan Hotel and the Erawan Bangkok, said Westbrook Partners' managing director Suchad Chiaranussati.

"Aside from Thailand, we are looking for investment opportunities in other Asian markets, especially Japan, South Korea, Singapore and Hong Kong," Suchad said.

In Thailand, the company sees potential in office buildings, residential condominiums, and luxury hotels in Bangkok and Phuket. But Suchad declined to reveal how much the firm was prepared to invest, saying it would depend on business opportunities.

"If it's a good project, we will buy it as soon as possible. If not, we will wait and see," he said.

Suchad believes the Thai property sector still has strong growth potential, especially in the office building segment, which is showing the strongest pace of recovery.

Somluck Srimalee
The Nation

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