Raffles Signs Shanghai Management Deal

Raffles International Limited has signed a management contract with Jing An City Construction Fitting Development Company (Jing’an Chengjian), to manage a new hotel development in Shanghai slated for opening in 2007.  Named Swiss™tel Grand Shanghai, the 478-room hotel will be managed under Raffles International’s Swiss™tel brand.  The deal marks Raffles International’s first foray into the buoyant Shanghai market and further strengthens its foothold in China.  With this move, the company has a global footprint of 38 hotels and resorts in 19 countries in 33 destinations. Spurred by significant economic growth over the past few years, Shanghai has become a major commercial city and financial centre in China.

Total tourists arrivals grew at an annual rate of 15.8% between 1998 and 2003 and are expected to continue to post double-digit growth over the next few years.  Correspondingly, demand for hotel accommodation increased by 10-15% per annum between 1997 and 2001.  As the designated host of the 2010 World Expo and a growing number of major conferences and exhibitions, and a big beneficiary of China’s recent accession to the World Trade Organisation, the future outlook for Shanghai’s hotel accommodation market remains strong.

“CapitaLand Group, with an established reputation in residential, commercial, retail, and hospitality businesses, has been steadily increasing its presence in China in all these core competencies.  In particular, the Group would like to increase its presence in the hotel sector to capitalise on China’s growing business travel and tourist arrivals, especially in Shanghai.  I am therefore pleased with the signing of this management contract with Jing’an Chengjian to manage a new hotel development in Shanghai. We will now have a Swiss™tel branded hotel in Shanghai which leverages on the hospitality management expertise of Raffles International Hotels and Resorts,” said Mr Liew Mun Leong, President and Chief Executive Officer, CapitaLand Group, and Deputy Chairman, Raffles Holdings Limited.

Ms Jennie Chua, President and Chief Executive Officer of Raffles Holdings commented, “The signing of this management contract with Jing’an Chengjian is a significant milestone for Raffles International as we have now gained a foothold in Shanghai which is a key and important gateway city in China.  We are indeed pleased to have a business partner who is highly reputable in Shanghai.  We believe that besides business and leisure travel, Shanghai is poised to experience growth in its convention and exhibition industry.”

The 25-storey, 478-room Swiss™tel Grand Shanghai will be conveniently located in the prime district of Jing’an.  The hotel is within walking distance to Nanjing West Road, the city’s busiest shopping street lined by high-end shopping malls such as Plaza 66 and Citic Square.

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It is approximately 50 minutes from the new Pudong International Airport or 20 minutes from the Hongqiao Airport, and is close to popular attractions such as the Jing’an Temple, Shanghai Grand Theatre and Shanghai Museum.  Upon completion in 2007, the hotel will have spa and gym facilities, a swimming pool, four restaurants and bars, Swiss Business Executive Club Floors and other business facilities.

Jing’an Chengjian is a wholly owned subsidiary of the Jing’an District Government in Shanghai.  An established development company in Shanghai, Jing’an Chengjian has core competencies in residential and commercial development and city planning.  Jing’an Chengjian is optimistic about the prospect of the hotel industry in Shanghai, and Swiss™tel Grand Shanghai is the first hotel development added to its existing portfolio of office buildings, condominiums and bungalows. 
Mr Xu Jian Zhong, General Manager, Jing’an Chengjian said “We believe that international standard hotels will be in demand in the near future.  We are indeed very pleased to be working with Raffles International, a renowned international hotel chain with the reputation and track record of managing hotels which are leaders in their respective competitive sets.  We are confident that Raffles International will manage the hotel to the highest standards of quality, and make Swiss™tel Grand Shanghai a successful international deluxe hotel.”
Raffles Holdings Limited is a subsidiary of CapitaLand Limited, which is listed on the Singapore Exchange Securities Trading Limited.  Recently, CapitaLand’s wholly-owned subsidiary, CapitaLand Retail China Pte Ltd acquired two retail malls located in Beijing, namely Anzhen Shopping Mall and Wangjing Shopping Mall.  In December last year, another of its subsidiary, CapitaRetail China Investments Pte Ltd, entered into two joint venture arrangements to acquire and manage a portfolio of retail malls in China.  In 2004, the Group also officially opened Raffles City Shanghai and introduced the Citadines service residence brand in Shanghai.
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