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Thursday, May 29, 2008

IGB to start building St Giles hotels next year

IGB Corp Bhd hopes to begin construction of its St Giles hotels in Bangkok, Thailand and Sydney, Australia next year, which it will then manage.

"In Bangkok, we are trying to finalise the deal. We are looking for a strategic partner. We have identified and are in negotiations with a few parties," managing director Robert Tan Chung Meng said.

Tan said the hotel ownership will be on a 51-49 per cent basis, in which the Thai partner will hold the majority stake.

"It will be a 650-room four-star hotel. Our portion of the cost of construction will be RM100 million. We hope to finalise something within the next six months," he told reporters after the company's annual general meeting yesterday.

In Australia, IGB is negotiating to build either a A$80 million (RM248 million) 250-room hotel or a A$150 million (RM466 million) 450-room hotel.

These two new hotels will add to its Cititel and Cititel Express brands, MiCasa All Suite Hotel in Yangon, Myanmar; and New World Hotel in Ho Chi Minh City, Vietnam. IGB also owns and operates the Boulevard Mid Valley and The Gardens Hotel in Mid Valley.

Asked about the status of plans to sell the 242-suite MiCasa All Suite Hotel in Kuala Lumpur, Tan said that it has held talks for the sale of a 50 per cent stake in the hotel.

Although he declined to reveal how much the 50 per cent stake may be worth, it is believed that the entire property could go for as much as RM230 million.

Meanwhile, IGB said that it will launch the final phase of the Mid Valley City project by the third quarter of 2008.

"The final phase consists of two 42-storey residential blocks with different configurations. The gross development value for the project is estimated to be RM750 million," he said.

IGB plans to sell the property from RM650 per sq ft onwards.

In the current year ending December 31 2008, IGB expects its asset management and hotel business to be the main profit contributor.

By New Straits Times (by Vasantha Ganesan)

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