It’s now official: Palms Resort sold to E-Land

After months of negotiations and false alarms, United Micronesia Development Association Inc. chair Jose R. Lifoifoi formally announced yesterday the multimillion sale of its Micronesia Resort Inc.—which owns the 14-story, 313-room Palms Resort Saipan in San Roque—to South Korea-based E Land Park.

E Land Park is one of the many companies in the E Land Group of Companies, a worldwide conglomerate engaged in fashion, hotels, condominiums and construction, and has reported holdings of some $7 billion.

“While UMDA had other interested parties, UMDA selected E Land because of its impressive business experience in Korea and China and its business philosophies—sharing, rightness, growth and serving,” Lifoifoi said in a statement.

He said E Land is one of the top companies in South Korea.

“UMDA looks forward to E Land’s renovation and revitalization of the hotel property and future promotion of CNMI,” Lifoifoi added.

Lifoifoi, who also chairs the Commonwealth Ports Authority’s board of directors, did not provide other details, including purchase price, exact date of purchase, and planned hotel name change.

Sources said the purchase price is “over $20 million but less than $25 million” but UMDA is mum on this as of yesterday.

Douglas Brennan, president of the Saipan Chamber of Commerce, said yesterday that UMDA’s announcement is “welcome news.”

“The purchase will mean new dollars in the economy, construction firms will be put to work, employees will be needed for the hotel, taxes will begin to be paid anew,” Brennan told Saipan Tribune when asked for comment.

Brennan said it is especially “good news to hear as we applaud Saipan Air’s emergence as a carrier for Asian tourists.”

“It’s a great problem to have wondering where we’d get the additional hotel rooms to accommodate an increase in tourist arrivals to the CNMI,” he added.

In January, the Korean Herald ran a story that said E Land Group has acquired Pacific Islands Club Saipan and Palms Resort Saipan for still undisclosed amounts. A month later, UMDA denied the report, saying their Palms Resort is not sold yet.

Known as the former Nikko Hotel, Palms Resort is a 14-story, 313-room hotel across the former La Fiesta Mall in San Roque. UMDA acquired it in February 2008 and renamed it Palms Resort. In 2010, it announced major renovation plans that resulted in the layoff of its more than 100 employees.

Sources also said PIC is still negotiating with E Land, although it was initially only a “stock purchase.”

UMDA-La Fiesta

In other news, Lt. Gov. Eloy S. Inos said the Fitial administration is close to awarding a contract to UMDA to revitalize La Fiesta Mall, which is across The Palms Resort.

Inos believes that UMDA’s plans for La Fiesta will complement the renovation of The Palms, now owned by E Land.

“We’re just working out the details,” said Inos, reiterating that UMDA agreed to take over the government’s annual land lease payment of $200,000.

Inos said the government is also negotiating rental fee and royalty fee with UMDA.

La Fiesta, he said, will be revived as a shopping mall with restaurants and boutiques, with an added feature of video lottery terminals.

Inos said the government hopes to sign the contract before the start of fiscal year 2013 on Oct. 1 because the governor’s 2013 budget no longer includes the government’s $200,000 annual lease payment for the La Fiesta property.

The former La Fiesta Mall in San Roque has been sitting idle for years yet costs the government $200,000 in annual lease since at least 2004, a year after the government bought the complex in 2003 initially for the Northern Marianas College’s Pacific Gateway Project but this did not take off.

UMDA was one of three bidders that responded to a request for proposal to revitalize the former mall.

The two others were Island Ventures LLC and Pacific Entertainment Technology.