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LONDON-Millennium & Copthorne is selling the Plaza hotel in New York to CPS One for €552 million ($680 million).

The joint venture that runs the hotel, and in which Millennium has a 50% stake, expects to complete the deal later this year. The property has been described as “the crown jewel of Manhattan’s fabled Fifth Avenue”. It was the setting for the film Home Alone and the venue for the wedding of Hollywood stars Michael Douglas and Catherine Zeta-Jones in November 2000.

Last year, M&C’s share of turnover from the hotel was €53.6 million ($66.1 million) while its share of the hotel’s pre-tax losses was €895,425 ($1.1 million). The hotel has 807 rooms, with rates for double rooms starting at €116 ($259) and suites from €527.3 ($650), and four restaurants, a health club and a business centre. The 1907 landmark French Renaissance-style building recently underwent a €48.7-million ($60-million) refit, including renovation of its rooms and lobby in traditional style and the installation of an 8,000 sf spa.

The company plans to use its share of the sale proceeds to reduce debt and fund the group’s general working capital.

Chairman Kwek Leng Beng says the sale was a result of a review of the group’s worldwide hotel portfolio by newly appointed joint interim chief executives Tony Potter and Wong Hong Ren. They have been assessing the potential of the group’s properties with a view to improving revenues and profits. “We believe the decision to sell the Plaza is in line with these considerations,” he says. Last week, Millennium said its recovery was “firmly on track” after turning half-year losses into profits of €30.4 million ($37.9 million).

The UK-based group, which suffered a sharp fall in profitability last year after Sars and the Iraq war hit the travel industry, says it was well positioned to make further good progress in the rest of its financial year. It hailed the continued recovery of hotels in London, New York and Asia, although the move into the black was widely expected due to last year’s weak comparatives.

M&C also announced that joint interim chief executive Potter would become permanent chief executive by the end of the year. The group operates 89 four-star and five-star hotels in 16 countries, including five London hotels and two at Gatwick airport. It has 2,200 employees in the UK and 12,300 staff worldwide.

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