NEW OWNER RENAMES HOTEL NIKKO SAIPAN

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By Mark Rabago

SAIPAN, CNMI (Saipan Tribune, Jan. 9) - Starting February 1, 2008, Hotel Nikko Saipan will be no more and the hotel at the northernmost part of Saipan will henceforth be called Palms Resort Saipan, with new owner United Micronesia Development Association still deliberating on who among world-class hoteliers Sheraton, Hilton, and Marriott to manage the property.

[PIR editor’s note: According to Businessweek, United Micronesia Development Association, Inc. owns Marianas Cablevision, which operates cable television systems. It also operates hotel pay-per-view operations and Internet service providers. The company is based in the Saipan, Northern Mariana Islands. ]

In an interview yesterday, director of asset management and chief financial officer Hiroyuki Saito said bringing in a well-known hotelier to run operations for Palms Resort Saipan will be in the best interest of the Commonwealth.

"[It's for] the future of the CNMI [Commonwealth of the Northern Mariana Islands] to have a world-class hotel operator here because they already have their own advertising network, clienteles, and standard and it would give the islands another landmark property," he said.

Saito said UMDA is committed to maximizing the potential of the San Roque property and hopes to reach this objective through the help of the eventual international hotelier it would select to run the former Hotel Nikko Saipan.

The UMDA official, who will serve as president and CFO of the company that will take over Nikko (Micronesian Resort, Inc.), added that he has also made a commitment to the government that the hotel will remain open until March 31, disputing reports that the property will shut down immediately after the sale to undergo renovations.

"The government has requested us to operate [even after the January 31] because it's the middle of the Lunar New Year. Closing down a 300-room hotel would have a major impact on the economy and would increase room rates of other hotels," he said. "Even under the new ownership, UMDA will accommodate all reservations until March 31."

To this end, Saito has requested JAL Group to allow UMDA the use of some of the logos and signages of Hotel Nikko Saipan beyond the January 31 expected close of sale date of the 313-room hotel.

In an announcement issued December 21, JAL Group and the UMDA agreed to transfer the ownership of Hotel Nikko Saipan, Inc. (the owner of the property) to UMDA by the end of January 2008.

Under the agreement, UMDA will purchase from JAL Group all of its stocks in Hotel Nikko Saipan, Inc. The hotel premises include a large water park, a wedding chapel facility, restaurants, banquet rooms, tennis courts, racquetball courts, and a botanical garden.

The purchase also includes nearby staff residences (PauPau Terrace), dormitories, and interest in Tropical Laundry & Linen Supply, Co., Ltd.

Closing of the transaction is scheduled to occur on January 31, 2008. Effective upon that date, JAL Hotels Co. Ltd, which currently manages the hotel, shall terminate its management contract.

UMDA is a CNMI corporation principally owned by regional individual and corporate shareholders, including the governments of the CNMI, Palau, and the Federated States of Micronesia.

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