Swiss-based Hrayssi Property Management Co. Ltd. plans to turn a 44-story building near People's Square into a four-star hotel, it said yesterday.
The building, at the intersection of Fengyang and Xizang roads, is owned by Shanghai New World (Group) Co. Ltd., which halted construction in 1998 for financial reasons.
"We are in talks with the current land and related debt owners and hope to be able to buy the building for about 600 million yuan (US$72.3 million)," said a Hrayssi official, who asked not to be identified by name.
Hrayssi, a unit of the Gefinor Investment Group of Geneva, Switzerland, plans to spend a total of 1 billion yuan on the hotel.
The company hopes to complete a feasibility study and the final transfer of assets by February.
With average foot traffic of 1 million people a day, the People's Square area is considered a gold mine for investors, analysts said. There are already 11 three-or-more-star hotels within a kilometer of the square.
"Despite so many rivals, my Swiss boss insisted that the business is promising," the Hrayssi official said. "Our research showed that almost any business would succeed in this area."
Other hotel companies seem to have come to a similar conclusion.
Last week, Marriott Inter-national Inc. unveiled plans to manage two hotels in Tomorrow Square, north-west of People's Square, starting in February.
And the Shanghai-listed Shi Mao Group said recently it will build a 333-meter-high commercial building in the area.
Shi Mao International Plaza will contain a five-star hotel with more than 500 rooms and a 10-story shopping mall.
( eastday.com June 26, 2002)
