29th May 2014 09:34
LONDON (Alliance News) - Action Hotels PLC Thursday said that it has signed a deal to buy a plot of land in Kuwait to build and develop a new four-star 160 room freehold hotel.
The hotel operator, which is focused on the Middle East and Australia markets, said the plot of land is in the prime business district of Sharq in Kuwait City, and it expects to open the hotel in 2017. Action currently has two operating three-star hotels in Kuwait City.
The group said the total price for the land, including commission and registration fees, is approximately USD12.3 million.
"Obviously this is a country that we know well, having completed two hotels that are performing ahead of our expectations to date," said Chief Executive Alain Debare in a statement.
Action Hotels said its two current ibis hotels in Kuwait, which are operated under long-term management agreements with France's Accor SA, are seeing high occupancy rates and the highest gross margins of all the operating portfolio.
This hotel is a new addition to Action Hotel's committed pipeline of eight further hotels by the end of 2016, and is still targeting 5,000 hotels rooms by 2020. Action believes that the economy and midscale hotel market in Kuwait remains undersupplied
"The addition of a four-star hotel is an opportunity to target a different intra-regional traveler audience to Action's existing three star offerings," the company said in a statement.
The company said it will fund the new development from existing resources.
Action Hotels shares were up 1.8% at 67.68 pence Thursday morning.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
AHCG.L