GGRAsia – Summit to pay US$36mln for Okinawa land for a luxury hotel

Summit to pay US$36mln for Okinawa land for a luxury hotel

May 19, 2023 Newsdesk Japan, Latest News, Top of the deck

Hong Kong-listed Summit Ascent Holdings Ltd, an investor in the Tigre de Cristal casino resort, near the Russian Pacific port of Vladivostok, says it will pay an aggregate of HKD280.0 million (US$35.8 million) for a plot of land near Miyakojima city, in Okinawa, Japan.

The group said it intends to develop a “luxury hotel with seaside cabins” in Okinawa (pictured), to “reap the benefits” of an expected increase in tourists to Japan, following the approval by the central authorities of the country’s first casino resort, in Osaka.

In a Thursday filing, Summit Ascent said it would pay HKD142.8 million to LET Group Holdings Ltd, for the latter’s 51-percent stake in the parcel of land in Okinawa, including loan liabilities. Summit Ascent is a subsidiary of Hong Kong-listed LET Group, formerly Suncity Group Holdings Ltd.

Summit Ascent is also to pay HKD137.2 million to a company called Solid Impact Ltd, for the latter’s 49-percent stake in the Okinawa land, also including loan liabilities. Solid Impact is described in the filing as being ultimately owned by Clayton Ip, an independent third party.

The Okinawa property consists of 28 adjoining land parcels, with a total area of approximately 108,799 square metres (1.17 million sq. feet). “As at the date of this announcement, the land parcel largely consists of undeveloped land,” stated Summit Ascent.

“Japan approved a plan to build the country’s first-ever casino in the western port city of Osaka, aimed at attracting domestic and global tourist spending,” noted Summit Ascent. “Other related industries can also reap the benefits of casino tourism, such as the hospitality industry,” it added.

The company also said there was “strong potential synergy with Japan’s plans and cross selling opportunities for its integrated resort business” in the Russian Far East.

Based on a preliminary construction plan, Summit Ascent said it expected to “utilise approximately HKD25 million” on the design and planning for future development of the Okinawa land.

In March, Summit Ascent reported a profit attributable to its shareholders of HKD11.8 million for 2022, compared to a nearly HKD230.0-million loss in 2021.

At the time, the company said the Phase II development of Tigre de Cristal – originally planned nearly to double the complex’s accommodation capacity and non-gaming amenities – remained “suspended”, with the firm “exploring alternative options, as well as potentially looking for strategic local partners.”

Earlier this month, Summit Ascent said it had agreed to terminate a revolving loan agreement with its parent company, under which Summit Ascent would allocate about HKD479.3 million to the revolving loan.

As that agreement was terminated, Summit Ascent said it would use HKD280.0 million to settle the purchase; HKD25.0 million for designing and planning the luxury development; and the remaining HKD174.3 million for general working capital or other potential investment opportunities.

Earlier this month, LET Group said one of its units was selling a plot of land in Hokkaido, Japan, for a total consideration of US$27.0 million.