WELLNESS provider Mary Chia is looking to move into the hotel business with the launch of a new integrated hotel and lifestyle centre.
The company has entered into a joint venture with businessman Lee Boon Leng, the son-in-law of executive chairman Mary Chia, to set up a firm called Hotel Culture.
It has paid $20 million for three properties on Mosque Street that will be converted into a combined hotel, lifestyle and wellness centre. There will also be a food and beverage business on the 21,399 sq ft site.
Mary Chia is slated to run the beauty, facial, spa and massage business, Mr Lee will be responsible for the food and beverage aspect, while a third party will be appointed to manage the hotel.
The 92-room integrated hotel, which is to emerge from the four-storey conservation shophouses, is expected to be completed by the third quarter of this year.
Mary Chia chief executive Wendy Ho said the property in the heart of the Chinatown heritage zone would charge between $150 and $180 per night and benefit from the tourist flow generated by the integrated resorts.
‘We are targeting people… who will enjoy all the spa, F&B and entertainment facilities combined with a boutique hotel stay,’ she added.
Ms Ho is bullish about her company’s investment, citing positive feedback from the surveys it has conducted.
The bulk of the $20 million bill for the property will be funded by $16 million worth of bank loans, with Mary Chia and Mr Lee extending another $3.5 million to Hotel Culture as shareholders’ loans.
The remaining $500,000 will come from the paid-up share capital of Mary Chia and Mr Lee’s stakes in the company.
Mary Chia paid $255,000 for its 51 per cent stake in Hotel Culture, while Mr Lee owns the remaining 245,000 shares. The loans extended are proportionate to their shareholdings.
Ms Ho said most of the firm’s investment would come from its initial public offering, which succeeded in raising $3.9 million last August.
‘We believe it is a worthwhile investment, and we will look into our costing,’ she said. The firm reported a net profit of $119,000 for the six months ended June last year.
Restaurant operator, Taste Paradise, which currently operates at two of the three units Hotel Culture is acquiring, has confirmed that it will be moving out.
Source: Straits Times, 29 Jan 2010