A Korean couple from Los Angeles with a voracious appetite for Guam real estate on Nov. 30 added the Holiday Inn Resort to their portfolio of income-producing properties.
Min S. Cho said she and her husband Hee K. Cho and Kwun Realty LLC bought the 8-year-old hotel for $7.9 million from Ely Del Carmen Five D Enterprises and 6D Enterprises. The Chos closed the deal at Security Title Inc. and are in negotiations with Holiday Inn on a contract to continue with branding and management. The Chos hold 48.89% interest in the hotel and Kwun Realty a California LLC holds 51.11% as tenants in common. Oh Chan Kwun representing Kwun Realty executed the warranty deed through the U.S. consulate in Seoul Korea.
The 251-room hotel which has restaurants a spa and swimming pool is in the heart of Tumon where most of Guam’s resort hotels are located.
Min explained why the couple who have been living in Los Angeles for the past 16 years decided to invest heavily in Guam real estate: “The economy here has been really underestimated and underrated. The military is coming and there is a good strong rental market.” She said JMSH LLC the couple’s hotel management company rents out two-bedroom apartments at Garden Villa for $2 000 a month and studios for $1 500 a month.
Jason Burnett general manager of the hotel said “As the local general manager of the Holiday Inn Resort Guam I am unable to make any further comments on the sale of the building and any further information that may be requested should be referred to InterContinental Hotel Group in Singapore.”
The Holiday Inn is the latest Guam acquisition for the Chos who have been divesting themselves of property in and around Los Angeles. Min said she and her husband over the past 24 months have sold 10 buildings including several apartment buildings and the San Gabriel Shopping Plaza a 17-store mall on the outskirts of Los Angeles that went for about $5 million. She said the sale of their buildings totaled about $12 million which they were required to reinvest to take advantage of a 1031 tax-deferred exchange. Min said they searched the state for deals but found that the real estate market in California is too hot.
“I am more than satisfied ” Min said about the Guam investments. She moved from Los Angeles to Tamuning in July and her husband who opened a golf driving range in downtown Los Angeles in March 2004 plans to join her in February. “I am really lucky. I like the people here and I have a great staff that knows what it’s doing. I feel strong about our business success here.”
Min said they looked around and found Guam and in December 2003 they began investing in hotels and apartments. Here’s what they have bought so far:
• Alupang Beach Tower was acquired on Jan. 17 2004 for $13.5 million from Hibari Guam Corp. The 138-unit luxury condominium and hotel complex is a prime residential address and home to some of Guam’s wealthiest. ABT’s ownership is Hee and Min Cho with 60% interest Diana Fink with 33.33% and Joung Sook Lee with 6.67%.
• Garden Villa which is located across from the Guam Dai-Ichi Hotel and was formerly the Dai-Ichi Garden Villa was acquired from Bank of Guam on Oct. 1 2004 for $4.5 million and is undergoing a $1 million remodeling that will be completed on Jan. 1. The Garden Villa has 117 units a combination of studio and two-bedroom hotel rooms with cooking facilities for long- and short-term rentals and 37 apartment units. When JMSH took ownership on Oct. 1 it also took over management from Rose Hotels International. The Chos own 48.89% of Garden Villa and Kwun Realty owns 51.11%.
• A leasehold of Airport Hotel Mai’ana on Airport Road was acquired June 21 2004 from I&F Corp. Guam. Junie Peterson operations manager for the Mai’ana said JMSH will change the name possibly to Airport Mai’ana Plaza. The leasehold ownership is Cho Property LLC with 60% and Diana Fink with 40% as tenants in common. Fink executed documents at the U.S. consulate in Ontario Canada.
• A leasehold on 66 units at Tumon Horizon Condominiums in Upper Tumon were acquired in a bulk sale from I&F Guam Investments LLC at the same time. Min said the purchase makes Cho Property LLC the majority owner at Tumon Horizon which has a total of 88 units. She said these are for long-term rentals. The ownership of the 66 units is 60-40 between Cho Property and Fink.
The Chos’ 250-yard driving range located at the intersection of Melrose and Vermont Avenues near Koreatown in Los Angeles is called Majestic Golf Land. The three-tiered range was built over the past four years for $6 million. It has 70 stalls a putting green restaurant pro shop and repair shop. Min said “There is a big demand in California among Koreans for golf practice ranges.”
The Holiday Inn Resort Guam was completed in 1996 and was named the Parc Hotel. Built next to Matapang Beach Park the Del Carmens said they changed the name to “Parc” to avoid having it identified as a Korean hotel because it would cater mostly to xenophobic Japanese. Five D Enterprises entered into a controversial 20-year lease with the government of Guam to develop and maintain Matapang Park with which the hotel shares parking. Ely Del Carmen is president of Five D and 6D.
The hotel was branded as a Holiday Inn Resort on June 29 2000 with a ceremony in conjunction with the opening of a California Pizza Kitchen in the lower lobby of the hotel. The hotel was developed by Five D Enterprises and built by Inland Builders Corp. another Del Carmen company. The Del Carmens closed California Pizza Kitchen months later in a franchise dispute. MBJ