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Hotel Nikko Alivila, other resorts get new owners

Date Posted: 2003-03-28

Several Okinawa hotels and resorts are undergoing ownership and management changes as the island continues to go through some hard economic times. Despite the record number of tourists visiting Okinawa, sales in many of the luxury hotels and resorts dotting the coastlines have been on downward trend for some time.

Cutthroat price competition that has deeply eaten to profits is principally to blame, say hotel industry experts, as most vacationers look for special discount packages and more modest accommodations, rather than luxury.

Nikko Alivila, a Spanish-style luxury resort in Yomitan, has been on shaky grounds since its owner, Sato Kogyo, filed for protection from its creditors in March. Bankruptcy managers sought a new owner for the property, and Tuesday announced that they have entered in a preliminary agreement with a real estate subsidiary of American investment bank Goldman Sachs. Indications are that the Goldman Sachs real estate unit intends to buy all shares in Nikko Alivila.

According to the agreement, the resort will continue to operate under JAL Group. The staff has been rehired, and hotel and restaurant operations will remain the same. The agreement is pending court approval, expected within days, after a meeting with Sato Kogyo's creditors.

Another large resort, Sun Marina Hotel in Onna Village, has been in the process of changing hands since August, when Osaka-based Japan Golf Promotion Corp. agreed to sell the property to Suruga Corp. of Kanagawa Prefecture.

Sun Marina is currently in the midst of reorganization that is aimed at cutting operation costs.

With no end to Japan's economic doldrums in sight, the going is bound to be rough for resorts and hotels for some time to come. Competition will ensure that prices for accommodations will stay at rock bottom, and that should raise many cheers among tourists.

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