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Saudi prince swoops on Raffles in Cambodia
DUBAI – The hotel-investment company controlled by Prince Alwaleed bin Talal, the Saudi Arabian billionaire, has made its first foray into Cambodia as part of its quest to expand into emerging markets.
Kingdom Hotel Investments (KHI), has snapped up Raffles Hotel Le Royal in the capital Phnom Penh, and the Raffles Grand Hotel d’Angkor in Siem Reap, for a total of US$35m.
Raffles will continue to manage the hotels while the properties will be owned by KHI.
Most recently, Dubai-based KPI paid US$58 million for a 100 percent stake in the 387-room Traders Hotel in Kunshan – the company’s first acquisition in China.
The move into China follows KPI’s US$124.3 million purchase of Langkawi’s luxury Four Seasons Hotel from Malaysia Airlines.
KHI intends to invest US$35 million in the resort by adding an additional 20 keys and developing 14 luxury villas that will be sold as Four Seasons Residences, to be completed at the end of 2008.
Sarmad Zok, chief executive of KHI, said the recent purchase of land for the Raffles Da Nang Resort on China Beach, Vietnam, “successfully demonstrates the company’s ability to grow within Asia’s emerging markets and be a leading player in an area fast becoming one of the most popular tourist destinations in the world”.
Raffles Da Nang will open in 2011 with approximately 150 hotel suites and 15 private residential villas for sale.
Tim Hansing, KPI senior vice-president acquisitions and development, said the company was not looking to build assets in mature markets such as Hong Kong, Australia and Singapore.
“In Singapore you will get a nice return but a safe return. In Hong Kong a more expensive investment will bring only a single digit return. In China there’s more risk but a double digit return.”
Hansing said KPI aimed to acquire a minimum of six properties a year (last year it acquired 11 hotels) of which four must be existing assets.
“We’re opportunistic investors, we’re not brand builders,” he said. “If the opportunity is there, we’ll take it.”
Ian Jarrett
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