Hong Kong based Regal Hotels has signed a $5 Billion agreement with Saudi Arabia’s Ministry of Investment to acquire, develop, and manage sustainable hotels and serviced apartments.
Regal Hotels intends to establish 100 new hotels globally by 2035 including 50 in the Middle East.
Regal Hotels and Cosmopolitan International recently announced their signing of a memorandum of understanding (MOU) with the Saudi investment authority, setting the stage for an unprecedented alliance in the realm of hotel development and management.
Under the MOU, a joint venture will be formed aimed at raising $5 billion to form an asset management platform. The platform’s objective includes acquiring, developing, and managing “sustainable” hotels, serviced apartments, and innovation centers across the globe.
The ambition driving this collaboration is grand. Regal Hotels envisions establishing 100 new hotels globally by 2035, with 50 of these to be located in the Middle East. As of now, the Hong Kong-listed hotel chain owns and operates 19 hotels spread across Hong Kong, mainland China, and Europe.
Poman Lo, vice chairman of Regal Hotels, expressed his delight in partnering with MISA. He highlighted the shared vision of becoming a global leader in delivering world-class services through their hospitality management expertise and adoption of sustainable technologies.
“We are delighted to partner with MISA to accelerate our shared vision of becoming a global leader in delivering world-class services through our hospitality management expertise and embracing sustainable technologies,” Poman Lo, Regal Hotels’ vice chairman
Expanding Business Ties
This partnership comes at a time when Hong Kong’s government is following China’s lead in expanding business ties with markets in the Middle East. The Asian financial hub has recently been turning to investors in the oil-rich region, particularly in Saudi Arabia, to help boost its economy.
Regal Hotels and Cosmopolitan International are both controlled by mogul Lo Yuk Sui, the second son of Lo Ying-shek, the late tycoon who founded Hong Kong real estate giant Great Eagle Holdings. Lo Yuk Sui’s younger brother Vincent Lo is the billionaire founder and chairman of the property company Shui On Group.
Green Tourism and Hospitality
This partnership aims to explore opportunities in hotel development and hotel management and foster green tourism in Saudi Arabia.
The collaboration’s goal is to acquire, develop, and manage a network of sustainable hotels, serviced apartments, and centres of innovation under the “iclub” brand of Regal Hotels.
The agreement comes amid warming ties between Riyadh and Beijing, with Hong Kong acting as a “value-added superconnector” between the two. This collaboration further cements the strengthening relationship between these global powers.
In April 2016, Saudi Arabia launched its Vision 2030, a comprehensive reform plan aimed at diversifying the economy, modernising culture, and attracting international tourists.
This collaboration with Regal Hotels and Cosmopolitan International aligns perfectly with this vision, contributing significantly to its realisation.
Recently, The Saudi Central Bank (SAMA) and the People’s Bank of China have signed a 3 Year year currency swap agreement worth $6.9 Billion to promote financial cooperation and trade. This agreement aims to enhance financial relations between the two countries and promote the use of local currencies.
Shaping The Future
This groundbreaking partnership signifies the growing ties between Hong Kong and Saudi Arabia, and it serves as an influential model for future collaborations in the hospitality and tourism sector.
As Saudi Arabia strides towards its Vision 2030, collaborations like these will undoubtedly play a pivotal role in shaping its future.