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Park Hotel Group stepping into S.Korea

Park Hotel Group has signed a deal to manage its first hotel in South Korea - the latest step on its regional expansion plan.

Posted on 06-Sep-2016

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Park Hotel Group stepping into S.Korea

Park Hotel Group has signed a deal to manage its first hotel in South Korea - the latest step on its regional expansion plan.

The 150-room Park Hotel Yeongdeungpo in Seoul is under construction and scheduled to open early next year.

Park Hotel Group signed the management contract with a member of the Seoul-based K2 Group, which is looking to diversify from its core functions of credit card authorisation and financial transaction systems. The hotel is K2 Group's first such project.

Park Hotel Yeongdeungpo, which is 45 minutes from Incheon International Airport, is near the Yeouido financial hub and attractions, including the National Assembly Building and 63 Square.

Park Hotel Group chief executive Allen Law told a briefing last Friday: "South Korea is an extremely fast-growing market and we want to be there early... From Seoul, we will look for opportunities in other key Korean cities."

Expanding into South Korea has always been in the company's plans, Mr Law noted. The country enjoyed double-digit year-on- year growth in inbound tourism in the first half of this year.

Park Hotel Group owns and manages 14 hotels, including upcoming openings. They are in Singapore, Malaysia, Indonesia, Hong Kong, China, South Korea, Japan and Australia, with Park Hotel Farrer Park due to open in the first quarter of next year, making it the company's fifth outlet here.

"Our Singapore hotels have been posting stable performance. They are trading at 80 per cent to 85 per cent occupancy and above, while visitor arrivals to Singapore have seen healthy increases," said Mr Law.

"As a whole we are seeing occupancy growth - which would give opportunities for rate increment - going into the next few months and next year as well."

In the near term, though, Mr Law sees very limited opportunities here, so much of the growth will be overseas.

"I'm looking at Hong Kong seriously. For the last 10 years, I've been trying to grow our Hong Kong portfolio but haven't been successful so far. Now is the right time, as certain market conditions are very favourable for us," he said.

In Australia, the group is set to open its first hotel in Adelaide in 2018. "We are looking (at expanding into) Sydney, Melbourne and other key Australian cities," Mr Law said.

Its hotel in Japan's Hokkaido has been among the company's top performers over the past two years, and it would seek to grow further in the country, he added.

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