Grand Formosa Regent Taipei, the nation's second-largest five-star hotel group by revenues, is expected to become the capital's largest hotel group in 2008 when its joint-venture hotel development project with Shinkong Life Insurance Co (
The two parties have signed an agreement of intent to build and operate two hotels and a shopping mall in the Xinyi district, in the eastern part of Taipei, which has long been dominated by the Grand Hyatt Taipei which has around 800 rooms.
According to the blueprint, they plan to build a five-star hotel with around 450 rooms, a suites hotel with between 200 and 220 rooms, and Taipei's biggest ballroom, accommodating 200 tables, said Aurelio Giraudo, Grand Formosa's general manager.
"This will be the biggest project after [the Grand] Hyatt and should be the first hotel to be built in 10 years," he said after a press conference yesterday held to mark the Grand Formosa's 15th anniversary.
Adding the new project to Grand Formosa's existing 500-room hotel on Zhongshan North Road, the firm would own nearly 1,200 rooms by 2008, beating long-time titleholder the Grand Hyatt. It would also allow the company to tap the hotel market in the Xinyi district, where exhibitions and conferences are held all year round.
Shinkong Life, the nation's third largest life insurer, started construction in June on the site, which it owns. When the construction is complete, the life insurer will own the buildings while Grand Formosa will be in charge of hotel management.
The two companies have cooperated previously, on the Jasper Villa Xinyi (
"The market now is not as rosy as we thought it would be at that time, as some foreign companies' local branches have relocated to China. But we are focusing on Taiwanese high-level executives who might need a place downtown during the week, and hope to boost the occupancy rate to 60 percent next month," Chang said.
In addition, the hotel expects to open three restaurants in the lucrative Xinyi district by 2007, encompassing Japanese, Italian and Thai cuisine.
The hotel is also poised to replicate its expertise in hotel, management and restaurant operations across the Taiwan Strait, making it the first local brand to explore the competitive hotel market in China.
In November, chairman Steven Pan (潘思亮) obtained shareholders' endorsement to invest US$30 million in China. However, due to high real estate prices in Shanghai, Beijing and several other major cities, the company is still looking for appropriate hotels to take over and operate, Giraudo said.
The company hopes to nail down hotel investment projects in China within the next three to four years, he added.
Grand Formosa's share price advanced NT$0.3 to close at NT$52.5 on the TAIEX yesterday.
The company reported NT$191 million (US$5.8 million) in sales last month, up 2.31 percent from a year ago. Combined sales for the first eight months of the year rose 14.63 percent from the same period last year to NT$1.76 billion.