Hotel Lotte Co., a luxury hotel chain operator of South Korean retail giant Lotte Group, is looking to add a four-star hotel in downtown Chicago to expand its US hotel network and international profile into its IPO program.
Hotel Lotte is working to close the purchase of the Kimpton Hotel Monaco Chicago in downtown Chicago in January at about 35 percent of the hotel’s estimated value of $ 56 million in 2013, according to multiple Monday retail sources.
The 190-room boutique hotel is nestled on Michigan Avenue and State Street shopping districts and the Riverwalk.
Hotel Lotte is renewing expansion in the US, which has stalled under the pandemic environment.
After the Midtown Manhattan hotel became the new owner of the New York Palace in 2015, its nameplate was changed to Lotte New York Palace. Founded in 1882, the 909-room luxury hotel on Madison Avenue is a New York landmark.
Lotte New York Palace has a relatively high occupancy rate even in a Covid-19 environment. The hotel was named one of the top 10 hotels in New York by the global travel magazine Travel + Leisure in 2017. It was also voted 3rd Best Hotel in New York by the US News & World Report in 2018.
In 2019, the Hotel Lotte jointly bought a hotel in downtown Seattle and has been operating as the Lotte Hotel Seattle since September last year.
With the addition of the Kimpton Hotel Monaco Chicago, Hotel Lotte would manage four hotels in the United States, including the one in Guam.
The company manages 12 hotels and resorts outside Korea with locations such as Moscow, Russia, Hanoi, Vietnam, New York and Guam. Hotel Lotte was the first Korean hotel chain operator to move to Moscow in 2010.
The Hotel Lotte actively pursues the so-called “asset light” strategy in its acquisitions. It forms a consortium for joint purchasing and operates hotels at lower costs on the basis of its know-how.
The company is the manager of four hotels – the Lotte City Hotel Tashkent Palace in Uzbekistan, the Lotte Hotel Yangon in Myanmar, the Lotte Hotel Samara in Russia and the Lotte Hotel Seattle.
The global expansion is aimed at enhancing Hotel Lotte’s corporate value to support its IPO.
As part of its regular management changes, Hotel Lotte appointed former Nolboo CEO Ahn Se-jin as the new head of the hotel business, making it clear that he wants to go public. As a strategist and expert in new business, Ahn has made remarkable achievements in business efficiency.
The IPO is also aimed at renaming its image as a Korean company.
Hotel Lotte is part of the corporate governance structure of the Lotte Group, whose shares are owned by the Japanese Lotte Holdings Co.
The corporate governance structure misled that Lotte was a Japanese company, said an unnamed industry representative. Hotel Lotte’s IPO would help shake its image as a Japanese company and improve group control by Lotte Group chairman Shin Dong-bin, the official added.
By Hong Sung-yong and Lee Eun-joo
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