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Ritz Carlton Redevelopment

12759 Views 40 Replies 21 Participants Last post by  hkskyline
Ritz-Carlton in line for offices facelift
Lee Yuk-kei
Hong Kong Standard
Monday, April 10, 2006

Lai Sun Development may redevelop the Ritz-Carlton as a hotel plus offices project to capitalize on surging office rentals in Central.

"We are studying the possible redevelopment of the Ritz-Carlton Hong Kong site," said chairman Peter Lam in the company's interim result statement Friday.

"Given the strong demand for prime office premises and the dearth of new supply in Central, prime office rentals in Central are likely to remain firm and could increase further," he added.

Lam cited the adjacent AIG Tower, which has achieved rents above HK$90 per square foot a month in tenancies signed up last year. Lai Sun has a 10 percent interest in the tower.

Lai Sun Development expects the current Ritz-Carlton site of about 15,000 square feet to provide not less than 225,000 sq ft of office space under current building regulations, which will not require paying any land premium or modifying the land lease with the government.

Ritz-Carlton Hong Kong, which is 65 percent owned by Lai Sun Development, has achieved an occupancy rate of 93 percent with rising room rates during the six months ending January 31, 2006.

Lai Sun swung back to a profit of HK$231 million for the six months ending 31 January 2006 from a loss of HK$1.17 billion in a year ago, thanks to the HK$178 million gain from revaluation of investment properties.

Rents for top-grade office space leaped 45 percent to the current average of HK$460 per sq ft per month from 2004, and very little new space is expecte
d to come on to the market in the medium term.

As a result, rents for prime office space in the central business district are expected to jump a further 20 percent this year, according to real estate consultancy CB Richard Ellis.

The present average vacancy rate at such properties is at a rock-bottom 4.8 percent, said CB Richard Ellis.

Kenny Tang, associate director at Tung Tai Securities, said: "The site [of Ritz-Carlton] has great redevelopment value as the market estimates the supply of grade A office [space] in the near future will be scarce, and demand for grade A offices will climb due to the buoyant economy.

"The proposed office-hotel complex will be a very valuable asset that may be separately listed in the form of a REIT [Real Estate Investment Trust]. That will help boost Lai Sun's share price."

Lai Sun Development had once accumulated debts amounting to HK$10 billion after paying a record HK$6.8 billion for a 65 percent stake in the former Furama Hotel - which was later developed into AIG Tower - before the Asian financial crisis and the subsequent Hong Kong property market crash of 1997. But a turnaround in rentals has helped the company reverse its fortunes and its shares have so far surged almost 140 percent this year, closing at HK$0.385 Friday.

The Ritz-Carlton first signed a yearly management contract with Lai Sun to operate the Central property in 1993. It is up for renewal in the second half of the year.

Sources in the local property market do not expect the lease to be renewed this year.
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It does a look a bit dated compared to the rest of the island skyline -- especially beside the AIG dynamo.
"not less than 225000sq ft of office space" equates to any guesses on a floor count??

similar size/structure to AIG perhaps??
wow... I've always wondered if this one would get redeveloped :-D Such great news :) another beatiful harborfront landmark in the making I'm sure :)
ahhh.. i kinda like the current ritz carlton though... i know it's not as shiny and transparent compared to its new neighbour, but it's still nice in a way.... i mean it represents the period of hk skyscrapers 10-20 years ago. (similar to exchange square or hk convention and exhibition centre/grand hyatt)

i think what should get torn down is the hutchison whampoa bldg... i've been saying this for YEARS and nothing's happening! very weird.
I like this building... don't think it should be demolished.
Agreed - I like this building...

I think I ate dinner there once.

Eaten there quite a few times - nothing and I mean NOTHING!!! beats the Petrus. ;)

Great pic by the way!
i guess we can expect a height similar to AIG Tower coz of Cheung Kong in the back?
i think AIG is at least 0.6million sq ft. I think the ritz carlton would be just a bit higher (very optimistic) than its current height if it get redeveloped.
They should just resurface the building and renovate the inside...its height is quite fine. Any taller and it will create a "wall effect" with the AIG and start polarizing the skyline just like 2IFC did.

I also don't want it to block whatever remaining view of the Cheung Kong Centre's lighting system because it can display text and graphics.
i wouldn't mind it going up to the level of the higher fire refuge floor of Cheung Kong... it seems like its height is around the lower one rite now...
It's time for Ritz Carlton to surprise the world.
superchan7 said:
I also don't want it to block whatever remaining view of the Cheung Kong Centre's lighting system because it can display text and graphics.
:yes: Agreed! AIG already block most of CK
In 2007, there came a proposal to tear down the Ritz carlton Hong Kong for a 225,000+ square foot office building.
In 2007, there came a proposal to tear down the Ritz carlton Hong Kong for a 225,000+ square foot office building.
Here is the thread in the constructions section :
I prefer an AIG tower with a skyscraper resembles 2IFC, slightly shorter, on the Ritz Carlton site, blocking the blocky Cheung Kong Building from the harbour view. This would generate more revenue for the developer of the redevelopment.

A precious chance for building a prominent skyscraper! Developers should not let Dubai surpass our achievement of the best skyline of the world--- we have to keep building skyscrapers whenever there are feasible flat land available for development. Rebuild skyscrapers in Central and West Kowloon is the top-notch choice for Hong Kong. It is up to developers to seize such opportunity.
I would have a skyscraper of about 150 metres to be built on the site of the former Ritz-Carlton Hotel.
Would look very nice with a reno, would fit in with the ever growing modern skyline
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