Hyatt ends hiatus

• Delayed project for Rs. 20 b five-star hotel cum residencies kicks off, 20-year management deal to be finalised with Hyatt, global financiers included; set to be largest hotel and tallest building in town

By Uditha Jayasinghe

The long-awaited Rs. 20 billion Hyatt management venture recommenced yesterday in what aims to be the Colombo’s biggest hotel and tallest building in Sri Lanka.

The 43-storey venture, which will have 475 rooms and 90 luxury residential suites, will be built by Sinolanka Hotels and Spa, according to its Chairman Gamini Senarath, who delivered the welcome address at the ceremonial recommencing of work at what was previously a Ceylinco investment down the scenic Galle Road.

Senarath added that the hotel would be opened by October 2013 but the suites would only be ready by August 2014. Hyatt Resorts will be given management of the hotel on its completion for an initial period of 20 years.

“The agreement with Hyatt will be signed next month and we are very confident that this will be a profitable venture. Given the increase in the tourism industry, the establishment of a five-star hotel with international management will be a definite boost to Sri Lanka,” he said.

State-run Sri Lanka Insurance is the main funder of the hotel and the building site has been leased to Sinolanka by the Urban Development Authority for 99 years. Sinolanka officials also remarked that negotiations are almost complete with international funders, but refused to disclose names as the agreements are yet to be finalised.  

The Galle Road land was originally leased to the previous developer in 2003 for scheduled completion of the project in 2008. However, the project has remained abandoned since 2009. In November 2011, the asset was acquired by the Government under the Revival of Underperforming Enterprises and Underutilised Assets Act, No. 43 of 2011.

In March 2012, the Cabinet of Ministers approved a proposal to redevelop the property as a fully-fledged multi-faceted hotel complex to support the Government initiative in tourism infrastructure development and to meet the demand from the growing tourists to the country.

Cabinet approval required private and State entities including Sri Lanka Insurance Corporation Limited to form a company, inter alia to ensure the revival of this property. Cabinet also approved the vesting of the property with the Urban Development Authority, which was the original owner of the property and for the UDA to grant a 99-year fresh lease to the new developer.

Based on this Cabinet approval, the new developer, Sinolanka Hotels & Spa (Pvt) Ltd. initiated the revival of this project and a consortium of investors consisting private and State entities including Sri Lanka Insurance Corporation Ltd. is expected to provide the required capital of Rs. 20 billion.

“It will be named the Hyatt Regency Colombo Hotel. Under the new construction phase, 28 new storeys will be added to the present construction,” the Chairman said, adding that large convention centres, gourmet restaurants and even an infinity pool are part of the design.

The short ceremony was an all-Rajapaksa affair, with Economic Minister Basil Rajapaksa attending as Chief Guest, together with Defence Secretary Gotabaya Rajapaksa and MP Namal Rajapaksa, and President Mahinda Rajapaksa being roundly thanked several times by various speakers.

President’s Secretary Lalith Weeratunga and Finance Ministry Secretary Dr. P.B. Jayasundera as well as officials from Litro Gas, the Board of Investment (BOI) and Sri Lanka Insurance attended the event.

Once the initial speeches were delivered, the Sinolanka officials signed the agreement with BOI to the sound of pirith chanting followed by Economic Minister Basil Rajapaksa initiating the construction.