Regal Hotels International Holdings, majority stakeholders in the Regal Hotel REIT, have bought a 111,868 sqm development site in Chengdu , China . The site, located in the Xindu District, was acquired at a Bureau of Land Resources auction.

The group is planning a mixed-use development on the site, including a five star hotel, related commercial areas and residential accommodation. Construction work on the site will start in 2008, and a total gross floor area of 500,000 sqm is planned, with approximately 38 percent of that earmarked for the hotel and commercial areas.

Donald Fan, Executive Director, Regal Hotels International Holdings, said the move is "in line with corporate strategy. We have been active in identifying development opportunities in the 1st and 2nd tier cities in China ."

According to Fan, no decision has yet been made as to whether the hotel will be offered to the Regal REIT upon completion. Under Hong Kong legislation, REITs are unable to develop their own real estate assets. "It's too early to make any conclusion at this stage and we will not rule out the option," he said. RFP