The number of hotels in Singapore managed by Park Hotel Group has shrunk to two from six in its portfolio, after the hospitality group terminated its management of Grand Park Orchard for "commercial and strategic reasons", The Straits Times learnt yesterday.
The Singapore-based group also lost a management contract for Park Hotel Farrer Park, which is now under IHG Hotels & Resorts. The hotel was rebranded as Holiday Inn Singapore Little India last Tuesday.
Park Hotel Group executive director Tan Shin Hui told ST that the company "chose to terminate its management of Grand Park Orchard" earlier this month.
"This decision was made for commercial and strategic reasons."
This is the fourth hotel to drop from Park Hotel Group's Singapore portfolio after the landlords of Park Hotel Clarke Quay and Destination Singapore Beach Road terminated the management contracts for both hotels following the winding up of Park Hotel Management (PHM), a firm that until recently owned Park Hotel Group.
On July 2, the High Court approved the winding up of PHM after New Park Property, the landlord of Grand Park Orchard, sought to wind up PHM over $5.2 million of debt owed in relation to the 308-room hotel.
"The commercial and strategic decisions were independent of PHM's winding up," said Ms Tan.
Park Hotel Group lost the management contract for Park Hotel Farrer Park, which is owned by RB Capital, in the wake of the winding up of PHM.
Ms Tan said the group continues to retain brand presence in Singapore through its remaining hotels here, Grand Park City Hall and Park Hotel Alexandra.
"The group continues to be one of Asia's leading hospitality groups. At present, we are focused on new market growth with overseas projects dominating the pipeline. We invested in Park Hotel Kyoto last year and are planning for an integrated resort in the Maldives," she added.
"In 2012, Park Hotel Group started out managing one hotel in Hong Kong, and is now a key player in the management, ownership and development in nearly 30 hotels across the Asia-Pacific."
Ms Tan said the company "had a good run managing Park Hotel Farrer Park since 2012, and the time has come to move on to other projects".
"This recent development involving Park Hotel Farrer Park was the result of a difference in contractual interpretation, not the result of any breakdown of the relationship with RB Capital or any unhappiness with our management.
"We left Park Hotel Farrer Park in excellent shape... No employee was laid off or retrenched as a result of the termination of our relationship with RB Capital."
IHG told ST that the employees of Park Hotel Farrer Park have been assigned to roles within the group.
In total, IHG operates 11 hotels here under brands including Regent, InterContinental, Crowne Plaza, Hotel Indigo, Holiday Inn and Holiday Inn Express.
Meanwhile, Park Hotel Clarke Quay has been renamed Riverside Hotel Robertson Quay, and is now managed by Ascott International Management, a wholly owned unit of CapitaLand. This comes after landlord Ascendas Hospitality Reit terminated the lease agreement and took possession of the 336-room Park Hotel Clarke Quay on Aug 28 because the tenant failed to pay $5.92 million in debt by June 30.
ST understands that Ascendas Hospitality Reit initially provided options to restructure the lease.
In July, the owner of Destination Singapore Beach Road terminated a 15-year hotel management agreement with PHM and took over the 300-room hotel.
Prior to PHM's winding up, Park Hotel Group had its ownership changed from PHM to Park Hotel Group Management on March 8.
The new owner is wholly owned by a British Virgin Islands company called Good Movement Holdings. It has only one director, Ms Tan, who was appointed on March 1.