KBC replaces Japan investor in Hanoi’s major hotel project

Authorities of Hanoi City have allowed Kinh Bac City Development Shareholding Corporation (KBC) to replace a Japanese investor in an upscale hotel project worth some US$500 million in the capital city.
KBC under Saigon Invest Group will replace Japan’s Riviera Corporation in developing the Lotus Hotel project southwest of Me Tri Commune at a prime location on Pham Hung Road near the National Convention Center.
Riviera, which beat South Korea’s Keangnam Group and five other bidders to win the high-profile five-star Lotus Hotel project over two years ago, finally decided to quit the costly plan.
Under Riviera’s initial plan, construction on the project was scheduled for completion later this year or early next year, but in fact the project is still on paper now. As soon as Riviera announced its withdrawal from the project a few months ago, a host of domestic investors have expressed their readiness to develop the project.
KBC was chosen among many big domestic companies including the Vietnam Construction and Import-Export Corporation (Vinaconex), Hoang Thanh Investment and Infrastructure Development Corporation, and Thien Thanh Production Trade and Construction.
The project will undergo numerous changes under the new investor.
The Ministry of Construction has approved a height limit of 35 stories for the project instead of the initial plan of 15 stories. The total floor space will nearly quadruple to 300,000 square meters to include a five-star hotel of 800 rooms plus commercial facilities and offices.
KBC said that it would develop the project as a landmark in Hanoi, pledging to start work on the project next year. The first-phase development will be carried out within two years.
The company has also worked with banks and financial organizations to finance the project.
Years ago, Japan’s Riviera and South Korea’s Keangnam beat several other competitors to enter the final round, then the Japanese won the only ticket in March 2007 to develop the hotel. Authorities then expected the project would be completed in time for the 1,000th anniversary of Thang Long-Hanoi City.
Upon receiving the investment certificate in 2007, Riviera and its partners CSK Finance Company promised to complete the modern nine-floor complex with 550 rooms no later than the end of the second quarter of 2010. The construction density on the site was set at 20%.
KBC is an affiliate of the Saigon Invest Group in charge of developing real estate, industrial parks, resorts and deluxe residences.
The company in June asserted its ambition to further tap the hospitality industry by signing a letter of intent with Starwood Group under which the latter would manage two five-star hotels whose construction would begin next year by the former. These are Le Meridien Danang Resort & Spa in the central city of Danang and Sheraton Dalat Resort in the Central Highlands province of Lam Dong, whose combined investment amounts to US$140 million.
The development of deluxe resorts is a further bold step of KBC into the tourism industry following the company’s initial investment in several hospitality projects, including Robin Hill Resort in Dalat, Lagi Resort & Spa – Ham Tan in Binh Thuan, and Danang Luxury Resort in Danang.
This growth also signifies the diversification of Saigon Invest Group in various business fields and its long-term vision of the potential hospitality industry in Vietnam.