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Oz-Asian
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Discussion Starter #1 (Edited by Moderator)
Name: Center Point Towers
Developer: Thailand’s LP Holding
Location: At the corner of Merchant and Sule Pagoda roads, Kyauktada township, Yangon
Number of Floors: 25 (2 buildings)
Descrption: Formerly known as the Sofitel, began back in 1995 but was mothballed in 1998. The project has 72,000 square metres of floorspace and includes a hotel, commercial offices and retail space. The commercial tower provides up to 15,500 square metres of A-class office space and 2500 square metres for retail.

Recently Completed Project

In 2010
Centrepoint Towers, Yangon

Work on the project, formerly known as the Sofitel, began back in 1995 but was mothballed in 1998.

In 2005 work restarted at the newly renamed site at the government’s urging.

The project has 72,000 square metres of floorspace and includes a hotel, commercial offices and retail space. The commercial tower provides up to 15,500 square metres of A-class office space and 2500 square metres for retail.



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Oz-Asian
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Discussion Starter #4
Opening date set for 300-room downtown hotel

Betting on tourism upswing, Thai developer targets November opening for hotel tower in $100m complex

By Pan Eiswe Star
(Volume 26, No. 507)


Centrepoint Towers Hotel will open in November, while space in an adjoining retail and office tower is already available for lease, the project’s developer says. Pic: Aung Tun Win

AFTER 15 years and almost US$100 million of foreign investment, one of the country’s largest hotel construction projects is nearing completion.

Centrepoint Towers Hotel, part of an integrated retail and hotel complex in downtown Yangon, is expected to open in November, the project’s chief executive, Mr Richard Mayhew, told The Myanmar Times via email last week.

The 300-room international-standard hotel will target the corporate and tourist markets and feature a 24-hour café, a Thai restaurant, a “top of the tower” restaurant, three lounge and music bars, a conference and banquet centre catering up to 1000 people and a fitness centre and gymnasium.

Mr Mayhew said the property’s owner, Thailand’s LP Holding, was seeking a hotel management company that could position Centrepoint Towers as a five-star international-standard hotel.
LP Holding, a hotel and hospitality company, also owns Mandalay Hill Resort.

“We see that a new hotel is required [in Yangon]. There is now increasing demand for accommodation in Yangon [because of] rising demand from international tourists and business travellers,” Mr Mayhew said, adding that most of the international hotels in Yangon are at least 15 years old.

“The number of tourists is peaking at 300,000 [foreign visitors a year] and we foresee that in the short term, three to five years, this number will rise exponentially and could reach the level of some of our neighbours in Southeast Asia – perhaps one million [visitors] plus,” said Mr Mayhew, who is also the general manager of Mandalay Hill Resort.

“With that there will be a need for major capital investment in the industry. [Growth] will also depend on increased flights and [providing] visas on arrival,” he said. “LP Holding Company is seriously looking at key locations elsewhere in Myanmar.”

In addition to the hotel, the property features 15,500 square metres of office space and a 2000-square-metre retail shopping centre. The complex is located at the corner of Merchant and Sule Pagoda roads in Yangon’s Kyauktada township.

While the hotel’s interior is still being fitted out, Mr Mayhew said construction work on an adjoining office tower was finished and space is available for lease.

LP Holding and the Ministry of Hotels and Tourism signed an investment contract for the Centrepoint development in November 1993 giving the company a 30-year lease over the site, according to a report in the New Light of Myanmar.

Construction began in 1995 but stalled in early 1998 because of the Asian financial crisis and the hotel operator, Accor’s Sofitel, soon pulled out of the project.

“The investment property, known at the time as Sofitel Hotel, was mothballed until 2005 when it was restarted,” he said.
In September 2009, Centrepoint’s backers pumped another $15.25 million into the project, according to the Thai embassy in Yangon and figures from the govern-ment’s Central Statistical Organisation, taking total investment to date to more than $100 million.

http://www.mmtimes.com/2010/news/507/n50701.html
 

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Hilton Signs Hotel in Yangon, Myanmar

http://www.asiatraveltips.com/news13/63-HiltonYangon.shtml

Hilton has signed a management agreement with LP Holding Co., Ltd to manage the Hilton Yangon in Kyauktada Township, Yangon, Myanmar.

The first Hilton Worldwide property in Myanmar, the 300-room Hilton Yangon will also be the first Hilton Hotels & Resorts branded hotel and is scheduled to open in 2014.

“This agreement is a significant milestone for us as it represents both Hilton Worldwide’s and the Hilton brand’s entry into Myanmar. Following the social and economic reforms the country has made over the past year, Myanmar has seen visitor arrivals grow by 45.1% compared to the previous year. Yangon, in particular, is positioned to grow much faster than many other emerging market in Asia. Backed by a strong partner like LP Holding Co., Ltd, we are very confident that as the first internationally branded hotel in Yangon, Hilton Yangon will set the benchmark for quality hospitality experiences catering to both domestic and international travelers,” said Andrew Clough, senior vice president, development, Middle East & Asia Pacific, Hilton Worldwide.

The 21-storey Hilton Yangon is 14.3 kilometers away from Yangon International Airport and is part of Centrepoint Towers, a mixed-use development which includes high-end retail boutiques and a premium office tower. Located at No. 65, the corner of Sule Pagoda Road and Merchant Street in the Kyauktada Township, the hotel is located opposite Yangon’s iconic High Court building and the famous Independence Monument Park.

As the one of the tallest commercial buildings in the city, hotel guests will enjoy impressive 365-degree views of greater Yangon and easy accessibility to the downtown colonial quarter and business district of the city.

Hilton Yangon will offer one all-day dining restaurant, two specialty restaurants, a destination sky bar and a lobby lounge. Offering a total of 1,400 square meters of event space including a 850-square meter ballroom, the hotel will also have an Executive Floor, a business center, a fitness center, a pool, a spa and car park facilities.

Yangon boasts numerous tourism attractions such as the beautiful golden pagodas which can be found dotted throughout the city, the most famous of which is the Shwedagon Pagoda. Other key attractions include Kandawgyi Lake with its Royal Barge, numerous museums and well preserved examples of grand colonial architecture.

Following the lifting of economic and social sanctions on the country, a number of international airlines have introduced new routes into Yangon to cater for the rapid growth in demand for corporate and leisure travelers.

Arrivals into Yangon are expected to remain strong and with new foreign investment laws passed in November 2012 aimed at bringing in foreign capital, the city is expected to generate high levels of growth across all industries especially in the areas of mining, energy, telecommunications, banking, real estate, legal, healthcare and hospitality.
 

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Yangon’s big-ticket hotel projects struggle toward the finishing line

http://www.mmtimes.com/index.php/national-news/10085-yangon-s-big-ticket-hotel-projects-struggle-toward-the-finishing-line.htm

In early 2013, on the sidelines of what was billed as Myanmar’s first international tourism conference, hotel management chain Hilton Worldwide announced its entry into Myanmar.

A worker at a construction site in Yangon unrolls cable. Lack of skilled workers is a problem for all developers embarking on major projects, including hotels. (Boothee/The Myanmar Times)



In a statement issued on March 6, Hilton said it had reached an agreement with Thailand-based LP Holding to manage Hilton Yangon in Centrepoint Tower, a mixed-use project in the downtown area.

The announcement reflected the widespread optimism over Myanmar’s economic future following a string of reforms. Tourism was booming and demand for hotel rooms was up sharply. US sanctions had just been eased further and another American giant was bringing its well-known brand to town.

For Centrepoint, a project that has staggered along since its launch 21 years ago, Hilton looked to be a saviour, bringing the investment and acumen required to finally develop the high-end hotel LP Holding had long promised.

But more than a year after the announcement, progress has been slow on the 21-storey tower at the corner of Sule Pagoda and Merchant roads.

The difficulties the project has encountered are symptomatic of the challenges foreign companies face as they seek to establish a presence in Myanmar. The expectations of a speedy and hassle-free entry a year ago are running up against the reality of the local operating environment.

“You go with your eyes wide open into this country. I’ve always been a bit careful [to reinforce that] it’s not Myanmar’s problem, it’s the foreigners’ expectations [that are the] problem. This country is not going to work itself out overnight,” said Tony Picon, managing director of commercial real estate firm Colliers International in Myanmar.

At Centrepoint, a corrugated metal wall has been erected around the perimeter of the tower work site. On the sidewalk adjacent to the wall, palm readers provide guidance on the future to pedestrians under the shade of small trees. A few construction workers dangle on suspended work platforms against the building’s façade. Inside, a new mechanical and electrical system has recently been installed.

The hotel was due to open last month. So far, only a single display room, on the sixth floor, has been fitted out. Chrome fixtures and an oversized freestanding tub dominate the bathroom, which is separated from the bedroom by a glass wall. A king-sized bed with a dark wooden frame sits in the middle of the room wrapped in plastic to protect it from dust of the work site.

Richard Mayhew, director of LP Holding, said the modern, open-plan rooms will be some of the largest in Yangon when completed.

While the hotel may become “the benchmark for quality hospitality experiences” that Hilton promised in March 2013, it is now clear that the 300-room hotel will only reach that benchmark more than six months behind schedule.

A Hilton official told The Myanmar Times that the company is now aiming for a partial opening of around 150 rooms by the end of 2014.

The delay has been caused by hold-ups on imported materials needed to outfit the hotel to meet Hilton’s standards. LP Holding is also having difficulty securing workers for the projects, according to the official, as many of those brought over from Thailand have been unsatisfied with working conditions in Yangon and left shortly after arrival.

Mr Mayhew declined to comment on specific issues the project is facing during a recent interview.

But the hotel delay is just the latest in a string of setbacks for Centrepoint, a property that despite its prime location has so far failed to develop as LP Holding envisioned.

Centrepoint is a relic of Myanmar’s first, ill-fated “opening up” to foreign investment in the early 1990s, prompted by Senior General Than Shwe initiating limited reforms after taking over the military leadership in 1992.

The Ministry of Hotels and Tourism signed a build, operate and transfer (BOT) agreement for Centrepoint in November 1993 with LP Holding. Construction began two years later in 1995 but stalled in early 1998 in the fallout of the Asian financial crisis.

French hotel group Accor’s luxury brand Sofitel, which was originally attached to the project, pulled out shortly after because of concerns over Myanmar’s human rights record.

The project sat idle until work began again in 2005. When the office tower opened in 2006, the project cost had ballooned to US$100 million. Four years later, in January 2010, Mr Mayhew told The Myanmar Times that the hotel would open in November of that year. In June 2010 the opening date had already been pushed back to early 2011. One long-time Yangon expat joked recently that the hotel’s soft opening has taken four years.

But Centrepoint and Hilton are far from alone in the stalled hotel stakes.

At the same time as Hilton was entering Myanmar, Accor returned the country, partnering with tycoon U Zaw Zaw’s Max Myanmar Group to develop a Novotel Yangon Max in Yangon, along with hotels in Mandalay and Nay Pyi Taw.

The company is one of many taking a second shot at Myanmar. British American Tobacco, Ericsson and Pepsi have all re-entered Myanmar after departing in the late 1990s.

Partnering with Max, a company still blacklisted by the United States, was considered a sign that the reputational risk of working with the country’s “cronies” was fading and that the connections these businesspeople enjoy could be beneficial. Unfortunately for Accor, they have not sped up development of two properties.

Max said in a statement posted on its website at the time that the deal was announced that the Novotel hotel on Pyay Road would be opening “no later” than December 2013. But an Accor spokesperson said last week that due to unspecified construction delays it will now be “fully complete” by the end of 2014, a full year later than planned.

U Bo Chan Tun, project manager at Max Myanmar’s hotel company, originally denied that the Yangon hotel was facing any setbacks.

“There was no delay as we didn’t give a deadline on the project to anyone yet,” he said.

When asked about the statement on Max’s website, he conceded there had been delays, which he attributed to changes being made to the hotel design.

The group’s MGallery hotel in Nay Pyi Taw, another Accor partnership, also failed to meet its original deadline. Boasting a cigar bar and an Italian restaurant, the 119-room project was slated for a full opening in 2013. It managed a partial opening to accommodate guests during December’s Southeast Asian Games before the doors were closed and construction work resumed.

It is now expected to open in the fourth quarter of 2014, a Bangkok-based Accor spokesperson said.

Problems of a different nature have surrounded another hotel partnership, which is attempting to rejuvenate and repurpose one of Yangon’s most iconic colonial buildings.

Backed by Serge Pun, the $400 million mixed-use Landmark project, which includes the redevelopment of the century-old Burma Railways building, has been unable to get underway due to an inability to secure a lease extension from the Ministry of Railways.

Mr Pun, the chair of public company First Myanmar Investment (FMI), Serge Pun & Associates (Myanmar), and Singapore-listed Yoma Strategic Holdings, told The Myanmar Times in December that he has applied to the ministry to extend the original 1995 lease for the maximum 70 years – 50 years, with two 10-year extensions – allowable under current investment laws.

But securing the extension has proved difficult, with the minister for railways being replaced twice in as many years. In late July U Zeyar Aung was replaced by U Than Htay, while a long-serving deputy minister, Thura U Thaung Lwin, was moved to another position.

Mr Pun declined to comment on the project. A Ministry of Railways official told The Myanmar Times that a meeting was held in Nay Pyi Taw recently to discuss the lease extension but no progress was made. The site has been largely closed, with weeds having quickly sprung up around the former Grand Mee Ya Hta Executive Residences building.

Despite the impasse, Yoma Strategic announced on March 10 it had signed an agreement with Hongkong and Shanghai Hotels to develop the railways building, which dates to the 1880s, into a Peninsula Hotel.

Martyn Sawyer, HSH Group director of properties, said the group was “satisfied with progress so far”.

“Our partners Yoma Strategic Holdings have many years of experience in Myanmar and we are both taking a long-term view for this project,” Mr Sawyer said.

These delays appear to have done little to dampen hotel chains enthusiasm, however, and visitor arrivals, particularly for business travellers, continue to grow strongly.

The Ministry of Hotels and Tourism says more than 2 million people visited Myanmar in 2013, although less than half arrived by air through Yangon. It has forecast 3 million visitors in 2014.

On the back of this growth, London-based research group World Travel and Tourism Council (WTTC) said in a March report that earnings in Myanmar’s travel and tourism sector are set to grow 9.5 percent in 2014 to $971 million.

When Marriott recently pulled out of a deal with Kanbawza Group of Companies because of a dispute related to quality controls, Swiss hotel chain Kempinski quickly stepped in.

U Moe San Aung, deputy director at the Kanbawza Group of Companies, told The Myanmar Times that Marriott’s rigorous inspections of the hotel construction site in Nay Pyi Taw were putting the project behind schedule. Marriott declined to comment on the deal.

Kempinski then signed a contract with Kanbawza in late March to manage the property, which will be fully owned by Kanbawza, according to U Moe San Aung. The Kempinski Nay Pyi Taw is scheduled to open on May 1, prior to the ASEAN Summit later that month.

A Kempinski spokesperson said only that “Myanmar is a market Kempinski is interested in and is exploring opportunities for entry”.

In December, Accor announced that it would begin developing three more projects, bringing its Pullman and Sebel brands to Yangon as well as a Novotel to Inle Lake.

A spokesperson for Accor said that the decision to develop these projects with Myat Min Company instead of Max was in no way linked to the current delays. Prior to the Accor deals, Myat Min was primarily an agriculture company.

A separate Hilton official, Kieran Bestall, director of development for Asia, said that the group is pursuing potential projects in Bagan, Nay Pyi Taw and Mandalay but declined to give specifics.

“The interest in Myanmar is exceptional,” Mr Bestall said.
 
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