Chinese building giant invests in $1bn Palm hotel
CSCEC invests in vehicle with SKAI Holdings developing Palm Viceroy
China State Construction Engineering Corporation is to invest in Skai Holdings' $1bn project to build a new Viceroy Dubai hotel on the Palm Jumeirah.
The companies will form a special purpose vehicle, ASSAS, to deliver the scheme, which is due to open during the fourth quarter of 2014.
Yu Tao, president and CEO of China State Construction Engineering Corporation Middle East, said: “We are thrilled to be partnering with SKAI Holdings to develop this exciting new project, which we believe will become one of the region’s most sought-after resorts.
"This is CSCEC’s first investment in a development project in the Middle East and marks a significant milestone in our growth in the region.”
He continued: “China has witnessed a surge in the number of individuals turning to alternative investments overseas as they look to preserve their wealth in light of its fast-changing economy.
"Dubai’s strategic location between Asia, Europe and Africa together with its burgeoning real estate sector is set to become a vital area of growth for Chinese investment.
Skai Holdings' CEO Kabir Mulchandani said: "CSCEC’s investment not only confirms its commitment to the region but also ensures that we are able to work in synergy to complete what is set to become one of Dubai’s most prestigious hotel projects on time and to the highest possible standard."
CSCEC is one of China's biggest's building contractors, as well as investing in real estate. Its turnover last year was $93bn (AED: 341.6bn).
Skai Holdings announced the launch of the $1bn Palm Viceroy and furnished residences project last month. It will have 481 guest rooms and suites with a further 221 residences in the same complex. The project is being developed under a model which allows investors to buy rooms and lease them back to the hotel in return for 40% of the room revenue. Skai Holdings said that it has already secured room sales of over $571.5m (AED: 2.1bn) on the project to date.