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Publish Date : 08-Nov-2013

KCC Real Estate Development Company has selected Australia as the location of its first hotel outside China in a tourism infrastructure investment totalling nearly A$20 million.

The former Kunming Construction Company has acquired a vineyard on Victoria's Mornington Peninsula for A$9.5 million and plans to spend a further A$10 million developing a luxury boutique hotel there.

KCC took ownership in October 2013 of Willow Creek Vineyard, 18 hectares on the Mornington Peninsula in the Australian state of Victoria ? and future home of a 39-room, upmarket boutique hotel which will add about 30 jobs to the region.

The groundwork for the company's overseas expansion was laid in 2005 when KCC Chairman Li Jie made the bold decision to shift the residential development group's strategy to tourism infrastructure.

KCC has since developed resort properties in south-west China's Yunnan province. It has partnered in joint ventures with US-based Hyatt Hotels, Singapore's Banyan Tree Hotels and Resorts and Pullman, owned by French hotel group Accor.

The investment dovetails with several trends among Chinese consumers. Rising incomes and health concerns over traditional high-alcohol spirits have lifted wine consumption in China. As a result, Willow Creek's 20-year-old pinot noir and chardonnay vines provide opportunities even as the company negotiates with architects, planners and management groups ahead of breaking ground on its hotel development.

In addition, rising numbers of visitors from China to Australia have underscored opportunities for Chinese investment in Australia's tourism infrastructure.

When the hotel at Willow Creek opens in 2015, it will be the seventh in KCC's portfolio but the first outside tourism property overseas.

"We were also looking at South-East Asia," said Bill Zhuang, Chief Operating Officer of KCC's Australian investment arm, Cloud Investment Operations in Melbourne.

However, the company took up the opportunity introduced by the Australian Trade Commission.

"The potential of Willow Creek was impossible to ignore," Mr Zhuang said.

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