Once it was the Paris of the East -- back in the 1930s, Shanghai was the heart of Asia. Now, after long years in the wilderness, luxury hotel groups are betting the city will reclaim its lost crown.
"Shanghai is a rising star in Asia," said Jean-Pierre Doesse, general manager of the Four Seasons Hotel, which opens its doors next month.
The 434-room Four Seasons is just one of the hotels which is hoping that Shanghai will attract a steady stream of rich business people in the years to come and will not turn into another Asian disaster story.
The J.W. Marriot has also just opened the 218-room "Courtyard by Marriott" in Shanghai's Pudong financial district and will open a second, larger hotel this July.
Meanwhile, international chain Westin are also getting in on the act, opening a new hotel close the city's historic Bund waterfront. The current Westin, near Hongqiao airport outside the city center, is being rebranded as a Sheraton.
Much of the optimism is based on a hoped-for boom following China's membership of the WTO.
"With China's accession to WTO, Marriott sees huge business opportunities in China, in particular Shanghai which is the financial hub for China," said Daniel Lai, Marriott International's regional sales and marketing chief.
The rush to open new hotels means that by the end of 2002, there will be more than 1,000 new rooms in the city pitching for business at the four- and five-star end of the market.
However, would-be doom merchants point at Bangkok as a cautionary tale. At the beginning of the 1990s, upmarket hotels poured into Bangkok to meet the demands of the country's burgeoning tourist industry, but soon there was a glut of rooms and not nearly enough tourists to fill them.
"Nobody made the money they thought they would," said one former hotelier.
A lot of money is being wagered on Shanghai proving different, despite its lack of a thriving tourist trade.
Hong Kong survived cyclical downturns of the hotel business because it was the financial center of Asia and the hotel chains are hoping Shanghai will step into its shoes.
Shanghai stands at the center of the Yangtze delta region, the heart of China's trade engine. The country's textile factories and manufacturing base flourishes in towns around the city.
Furthermore, the city's universities turn out graduates with better English than their equivalents in cosmopolitan Hong Kong and who work longer hours for less pay, helping oil the wheels of Shanghai's growing role as a service center.
"Shanghai has a growing middle class. The people have a pleasant disposition and more importantly, they have brains," said Alan Hepburn, chief operating officer of a new seven-storey development on the Bund.
The venue will feature a restaurant from the world-famous and highly exclusive Nobu chain, partly owned by actor Robert De Niro, as well as galleries, designer shops and a spa.
"Most people are taking a very bullish view of the city. In fact, there are no breaks on Shanghai right now," said Hepburn.
Tina Liu, communications director of Shanghai's Grand Hyatt -- the world's highest hotel -- goes further.
"Shanghai is going to be a leader and an economic heart of Asia. Because China is such a big part of Asia and Shanghai is the dragon's head, that will replace a small place like Singapore or Hong Kong," she said.
When Hyatt began planning the hotel, which tops the Golden Trade Tower owned by the Chinese finance ministry, Pudong was little more than paddy fields, and the new hotel boom shows that many hope for the same growth rate in the coming decade.
"When we first signed on the project people asked why we chose Pudong because there was nothing here. Hyatt has always been a hotel group that has view of the future," said Liu with pride.
And the future is rosy? Not necessarily. There remain many lurking problems under Shanghai's glossy surface.
For the moment, China's currency remains unconvertible, which protects stock markets choked with companies hemorrhaging money, and banks on the brink of insolvency by international standards.
Such yawning financial chasms bar the route to Shanghai overtaking Hong Kong as the financial center of China, let alone the region.
By the end of the year, Shanghai will have more than enough luxury hotels, but demand will take a few years to catch up.
If WTO fails to prove the business bonanza many are hoping for, there will be a lot of empty rooms to fill.
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