The Business Herald’s markets and banking reporter.

New Chinese hotel investment for Wynyard Quarter

An artist impression of the new Hyatt Hotel being built on Auckland's waterfront.
An artist impression of the new Hyatt Hotel being built on Auckland's waterfront.

The Chinese company behind Wynyard Quarter's luxury Park Hyatt project is set to purchase a nearby site on which it will invest more than $300 million into its second Auckland hotel development.

And the firm is also eyeing additional opportunities in Queenstown and Wellington.

In an interview in Beijing, Fu Wah International president Chiu Yung said a three to four-star hotel and apartment complex would be built on the second site, located only a couple of blocks away from the Park Hyatt project.

He said Fu Wah was attracted to New Zealand's booming tourism industry, which is facing a shortage of hotel rooms.

"The tourist market in Australia and New Zealand is on a positive cycle," Chiu said.
Fu Wah's South Pacific area general manager, Richard Aitken, said the firm had secured an unconditional agreement to purchase the site, currently owned by a company associated with Goodman Property.

Settlement of the deal was expected to take place on June 30, he said.

The nearly 1 ha site is bordered by Beaumont, Packenham, Daldy and Gaunt streets and houses marine-related businesses and car parking tenants on short-term leases.

Fu Wah held a groundbreaking ceremony in March for the $200 million, five-star Park Hyatt development.

It's located on the waterfront site formerly occupied by Team New Zealand and is expected to open in 2018.

The company did not purchase the land in that case, with ownership retained by Panuku Development Auckland, a council organisation.

Aitken said the second, freehold site could be developed into 45,000 sq m of floor space, likely to be comprised of a 100 to 150-room hotel and up to 250 apartments.

It would require an investment of well over $300 million by Fu Wah, including the land purchase, he said.

Aitken said the acquisition did not require Overseas Investment Office approval because the purchase price was below the $100 million threshold and the site wasn't deemed "sensitive".

Fu Wah International president Chiu Yung.
Fu Wah International president Chiu Yung.

"Our current thinking is that we will operate a Hyatt-branded hotel [at the second site] because of the synergies of operating with Park Hyatt Auckland," Aitken said.

Hyatt operates a number of sub-brands including Andaz, Hyatt House and Hyatt Place.

Chiu said construction of the second project may begin as early as next year and it could be completed by 2019.

Fu Wah's two Auckland hotels would complement each other, he added.

"For instance if the owner of a company - or important VIPs - are staying in the five-star Park Hyatt, accompanied personnel could stay in the three to four-star hotel."

At the Park Hyatt groundbreaking ceremony Prime Minister John Key said annual visitor numbers from China alone could soon top one million, up from around 370,000 currently.

Watch: Park Hyatt's Groundbreaking Ceremony:

Video

Total annual visitors to New Zealand cracked the three million mark for the first time last year.

Chiu said Fu Wah had also conducted "site analysis" at several locations in Wellington and Queenstown.

There was potential for the company to eventually operate up to four hotels in New Zealand, he said.

Fu Wah's real estate portfolio in China is centered on Beijing, with properties in the Chinese capital including the Jinbao Tower, Legendale Hotel and the Beijing Hong Kong Jockey Club.

The company acquired Melbourne's Park Hyatt hotel in 2014 in its first major foray into the Australian market.

Chiu's mother, Chan Laiwa - one of China's richest women - founded Fu Wah in 1988.

- NZ Herald

Christopher Adams is travelling in China as a recipient of the New Zealand China Council Media Award.

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