Property Types
Hospitality
Jun 17, 2009
By: Barbra Murray, Contributing Editor
As the U.S. hotel market continues to tumble hand-in-hand with the flailing economy, many hotel concerns are finding opportunities for projects in less hindered travel destinations abroad, and MGM Mirage is no exception. The Las Vegas-based gaming and hospitality company has just announced a partnership with Egypt's New Giza for Real Estate Development to create the MGM Grand New Giza, just outside of Cairo, Egypt.
With a location 40 minutes from Cairo International Airport, the 550-room MGM Grand will anchor the three-facility hotel segment of New Giza's upscale master planned community, which will ultimately span 1,500 acres near the foot of the city's renowned pyramids. New Giza will finance development of the MGM Grand, while MGM Mirage will be responsible for management services and brand fees to be provided through the company's two-year-old MGM Mirage Hospitality subsidiary. "In the current economic environment, this is the perfect way for our company to continue its expansion, because there's no capital outlay," Gordon Absher (pictured), vice president of public affairs for MGM Mirage, told CPN. "We're participants in the management and design, and we're being paid for our participation." Currently in the design phase, the New Giza resort project is scheduled to reach completion in 2013.
From 2007 to 2008, tourism in Egypt increased 15.5 percent, according to a recent report by Business Monitor International. This year, however, Egypt's foreign tourist arrivals are projected to drop quite dramatically due to poor economic conditions in key source markets, but numbers are expected to increase again in 2010. Despite anticipated near-term obstacles, the future of the hotel sector looks bright for Egypt and, in particular, Cairo, where the infrastructure continues to improve and commercial developments are on the rise, as per a study by global consulting and services firm HVS. In addition, Cairo hotel operators have shifted focus to upscale properties, so a bevy of four- and five-star resorts are on target to debut over the next few years. Among the approved projects are the 402-room St. Regis Cairo and the 250-room Four Seasons Madinaty, which are scheduled to deliver in 2012 and early 2014, respectively. Also, the Ritz-Carlton Hotel Co. L.L.C. will open its first property in the city in 2011, with the $64 million conversion of the Nile Hilton.
Beyond Egypt, U.S. developers have been combing potentially fruitful locales around the world for expansion endeavors lately. In May, Beverly Hills-based Hilton Hotels Corp. announced it had signed agreements in Panama for the management of a new Hilton and a new Embassy Suites by Hilton; the franchise for a Doubletree by Hilton property conversion; and the franchise for a new Hilton Garden Inn. Dallas-headquartered LaQuinta Inns & Suites also announced plans for Panama, revealing a deal with a local developer to build 13 LaQuinta-brand hotels. And in March, news emerged that Philadelphia-based AMResorts had just received approval to develop two new luxury resorts at Cap Cana in the Dominican Republic at a cost of $200 million.
Additionally, MGM recently revealed plans for a 250-room Bellagio Hotel, a 350-room MGM Grand hotel and a 30-suite Skyloft hotel at the $4 billion mixed-use Dubai Pearl in partnership with the luxury project's developer, Pearl Dubai FZ L.L.C; all three properties will open their doors in 2013. "In each country we're going into, we have different partners," Absher said. "It's global expansion without capital outlay."
By: Barbra Murray, Contributing Editor
As the U.S. hotel market continues to tumble hand-in-hand with the flailing economy, many hotel concerns are finding opportunities for projects in less hindered travel destinations abroad, and MGM Mirage is no exception. The Las Vegas-based gaming and hospitality company has just announced a partnership with Egypt's New Giza for Real Estate Development to create the MGM Grand New Giza, just outside of Cairo, Egypt. With a location 40 minutes from Cairo International Airport, the 550-room MGM Grand will anchor the three-facility hotel segment of New Giza's upscale master planned community, which will ultimately span 1,500 acres near the foot of the city's renowned pyramids. New Giza will finance development of the MGM Grand, while MGM Mirage will be responsible for management services and brand fees to be provided through the company's two-year-old MGM Mirage Hospitality subsidiary. "In the current economic environment, this is the perfect way for our company to continue its expansion, because there's no capital outlay," Gordon Absher (pictured), vice president of public affairs for MGM Mirage, told CPN. "We're participants in the management and design, and we're being paid for our participation." Currently in the design phase, the New Giza resort project is scheduled to reach completion in 2013.
From 2007 to 2008, tourism in Egypt increased 15.5 percent, according to a recent report by Business Monitor International. This year, however, Egypt's foreign tourist arrivals are projected to drop quite dramatically due to poor economic conditions in key source markets, but numbers are expected to increase again in 2010. Despite anticipated near-term obstacles, the future of the hotel sector looks bright for Egypt and, in particular, Cairo, where the infrastructure continues to improve and commercial developments are on the rise, as per a study by global consulting and services firm HVS. In addition, Cairo hotel operators have shifted focus to upscale properties, so a bevy of four- and five-star resorts are on target to debut over the next few years. Among the approved projects are the 402-room St. Regis Cairo and the 250-room Four Seasons Madinaty, which are scheduled to deliver in 2012 and early 2014, respectively. Also, the Ritz-Carlton Hotel Co. L.L.C. will open its first property in the city in 2011, with the $64 million conversion of the Nile Hilton.
Beyond Egypt, U.S. developers have been combing potentially fruitful locales around the world for expansion endeavors lately. In May, Beverly Hills-based Hilton Hotels Corp. announced it had signed agreements in Panama for the management of a new Hilton and a new Embassy Suites by Hilton; the franchise for a Doubletree by Hilton property conversion; and the franchise for a new Hilton Garden Inn. Dallas-headquartered LaQuinta Inns & Suites also announced plans for Panama, revealing a deal with a local developer to build 13 LaQuinta-brand hotels. And in March, news emerged that Philadelphia-based AMResorts had just received approval to develop two new luxury resorts at Cap Cana in the Dominican Republic at a cost of $200 million.
Additionally, MGM recently revealed plans for a 250-room Bellagio Hotel, a 350-room MGM Grand hotel and a 30-suite Skyloft hotel at the $4 billion mixed-use Dubai Pearl in partnership with the luxury project's developer, Pearl Dubai FZ L.L.C; all three properties will open their doors in 2013. "In each country we're going into, we have different partners," Absher said. "It's global expansion without capital outlay."
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