Morgans Hotel Group to Launch International Expansion with New Delano in Dubai
NEW YORK--(BUSINESS WIRE)--Morgans Hotel Group Co. (NASDAQ: MHGC) (“MHG”) today announced the development of Delano Dubai with a leading real estate development firm, marking the commencement of MHG’s international expansion. Delano Dubai will be operated by MHG under a long-term management contract and is expected to open by 2012.
Delano Dubai will be located at the epicenter of the Dubai Waterfront. The project is expected to consist of a three-building complex overlooking the iconic Palm Jebel Ali, with panoramic views of the Persian Gulf, the open spaces of the waterfront and beachfront parks. The hotel is expected to have approximately 200 guest rooms and 100 branded residences, and will include a restaurant, bar and spa. Adjacent to the property will be another 360 residences with hotel services, rising 44 stories over the waterfront. Visitors and residents of the complex will have access to a retail promenade lined with luxury boutiques, which stretches to the beachfront. Plans also call for a vast cabana bar built into the pier that will offer a dock for boats and gondolas which will shuttle guests to a floating saltwater pool, the only one of its kind in Dubai.
“At MHG, our growth strategy has been to expand our properties to 24-hour gateway cities, both in the U.S. and internationally,” said Marc Gordon, Chief Investment Officer of MHG. “We are pleased to announce MHG’s entry into the Middle East, a major milestone in the execution of our strategy to expand our brand to the world’s most exciting destinations. MHG has extended its efforts and resources in developing business outside of the US, and this transaction is the first of what we hope will be multiple new hotels in other parts of the world. Our properties are renowned by guests throughout the world and we look forward to leveraging our reputation as we enter new international markets.”
“Dubai has become a true center of international business, style and luxury, and we are confident that Delano Dubai will become the ultimate beach location for the sophisticated international traveler,” said Fred Kleisner, President and Chief Executive Officer of MHG. “As one of the most upscale, dynamic business and leisure markets, attracting nearly five million investors and tourists annually, Dubai is a key target market for us, particularly given our strong presence in the UK. With its central location, rich architecture and luxury amenities, we are confident that Delano Dubai will become one of the most popular hotspots in Dubai.”
Upon completion, MHG is expected to operate the hotel under a 20-year management contract with two 10-year extension options. In addition to hotel management fees, MHG will also realize fees from the developer’s sale of both the branded and unbranded residences.
About Morgans Hotel Group
Morgans Hotel Group Co. (NASDAQ: MHGC) operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and The Shore Club in Miami, Mondrian in Los Angeles and Scottsdale, Clift in San Francisco, and Sanderson and St Martins Lane in London. MHG and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. MHG has other property transactions in various stages of completion, including projects in Miami Beach, Florida; Chicago, Illinois; SoHo, New York; Las Vegas, Nevada; Palm Springs, California; and Boston, Massachusetts. For more information please visit www.morganshotelgroup.com.
Forward-Looking and Cautionary Statements
Statements contained in this press release which are not historical facts are forward-looking statements as the term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by the use of words such as "expects," "plans," "estimates," "projects," "intends," "believes," "guidance," and similar expressions that do not relate to historical matters. These forward-looking statements are subject to risks and uncertainties which can cause actual results to differ materially from those currently anticipated, due to a number of factors which include, but are not limited to, downturns in economic and market conditions, particularly levels of spending in the business, travel and leisure industries; hostilities, including future terrorist attacks, or fear of hostilities that affect travel; risks related to natural disasters, such as earthquakes and hurricanes; risks associated with the acquisition, development and integration of properties; the seasonal nature of the hospitality business; changes in the tastes of our customers; increases in real property tax rates; increases in interest rates and operating costs; the impact of any material litigation; the loss of key members of our senior management; general volatility of the capital markets and our ability to access the capital markets; and changes in the competitive environment in our industry and the markets where we invest, and other risk factors discussed in MHG’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007, and other documents filed by MHG with the Securities and Exchange Commission from time to time. All forward-looking statements in this press release are made as of the date hereof, based upon information known to management as of the date hereof, and MHG assumes no obligations to update or revise any of its forward-looking statements even if experience or future changes show that indicated results or events will not be realized.
