SM hopes to seal Sheraton partnership deal in 6 months

SM Investments Corporation is looking at six months until the company can decide which international hotel chain will be its partner to pursue the company's unfinished Cebu hotel project.

In an interview with Hans Sy, SM Investments Corporation executive vice president, he said that the company is now in negotiations with three international hotel chain brands, however he refrained to divulge the identities of the companies.

Sy dismissed impressions that the SM Group has lost interest in pursuing the Sheraton Hotel in Cebu, saying interest is still there, in fact his sister Teresita Sy-Coson is talking with these potential hotel partners.

The SM Group is trying to seal a deal with a hotel chain that can put in equity to the project, not just a management deal contract.

According to Sy, SM cannot manage a hotel, and would rather give it to a management chain, as hotel business is not SM's forte.

The unfinished hotel project is designed as five-star hotel, with 470 rooms, but the Sy family is apparently prioritizing its shopping mall projects, such as the newly opened P6.5 billion mall project, the Mall of Asia located in SM Central Business Park, Bay City, Pasay City, Metro Manila.

The Henry Sy led company, has invested about P300 million for the construction of the towering (supposedly Sheraton) Hotel project, located right across SM City Cebu shopping mall. The company still needs about P1 billion additional investments in order to fully complete the hotel construction.

He added that the company is bullish about Cebu, especially on its retail business, as well as its tourism potential. The very reason why they are pursuing the completion of the hotel and hopefully seal a deal with a partner within six months.

However, he said the time frame may change, depends on the development of the negotiation.

Because of its strong confidence for Cebu, SM Prime Holdings, Inc. (SMPHI) is in fact, ready to spend about P2 billion for building two more shopping malls in Cebu.

Cebu has only three five-star accommodations, these are resorts located in Mactan Island, the Shangri-La's Mactan Island Resort and Spa, Plantation Bay, and Cebu Hilton Resort and Spa.

Cebu City has no five-star hotel accommodation yet, Sheraton Cebu might just be the first five-star City-based hotel.