Australia's StayWell Hospitality will not operate the planned Park Regis in Kuala Lumpur, located within the Taragon Puteri KL integrated development.
This would make it the second international chain management deal not materialising after being signed.
StayWell had replaced Rendezvous Hospitality Group following the termination of the latter's management contract last year.
StayWell, in a press release yesterday, said that it had "conditionally agreed with Taragon Capital Malaysia Sdn Bhd to relinquish the agreement to operate the four-star hotel being developed at Taragon Puteri Kuala Lumpur, Malaysia, by Taragon."
Its chief executive officer Simon Wan said various building designs and product positioning differences between both parties emerged during the planning process which resulted in the conditional agreement to end the operating agreement by mutual consent.
StayWell and Taragon had last August signed a deal, whereby StayWell will operate the hotel located in Changkat Thambi Dollah, off Jalan Pudu, and start operations in January 2011.
The hotel is part of the RM250 million Taragon Puteri KL integrated development. It also comprises serviced apartments and retail lots. The integrated development was launched in 2008.
The hotel component is categorised as a four-star, featuring 445 suites which aims to capture travellers on business and leisure.
Meanwhile, Wan said that it will continue to look for suitable international four-star hotel in Kuala Lumpur, which remained a core target for StayWell's four-star Park Regis brand. The group also manages the Leisure Inn brands.
"Malaysia, with Kuala Lumpur in particular, is such a vibrant destination. We remain keen to add a suitable hotel to our portfolio as this represents a strategic geographic location for our hotel network in the region, particularly considering our recently opened Park Regis hotels in Singapore and Dubai," Wan said.
He added that the addition of a hotel in Kuala Lumpur will enhance the performance of these key hotels and believes that it can achieve exceptional performance in the Kuala Lumpur market. – Business Times
