Shin: E-Land’s hotels are struggling

Brian Shin, who is the chief executive officer of E-Land Group and president of Suwaso Corp., said yesterday that their hotels on Saipan are absolutely struggling and if the number of tourists coming to the CNMI won’t improve, he doesn’t know if all their hotels will survive.

Shin shared the challenges of their three hotels during a Senate Committee on Resources, Economic Development and Programs & Gaming meeting at the Senate chamber on the Department of Public Lands’ proposal to grant a new lease to Suwaso so it could continue to operate its Coral Ocean Resort for another 40 years.

E-Land Group owns the majority share of Suwaso Corp. The company also owns Pacific Islands Club Saipan and Kensington Hotel.

Sen. Corina L. Magofna (Ind-Saipan), who chairs the REDPG Committee that is reviewing DPL’s proposal to Suwaso, said they look forward to wrapping this process and hopefully schedule a joint committee meeting with the House of Representatives Natural Resources Committee sometime next week.

She thanked E-land, Suwaso, and DPL for providing all the supporting documents that the committee has requested both sides.

“You have submitted I would say at least 90% to 95% of what we requested and I completely understand some of the documents that you weren’t able to submit due to propriety information,” the chair told the parties.

During the discussions, Shin said to be completely honest, he believes every hotel on the island is struggling right now and that he cannot say E-Land’s hotels are exceptions to that.

He stated that he cannot say they’re not considering “any actions” because right now as they speak, this summer, year over year, the flight numbers have been decreasing.

Shin said the Japanese tourism market is virtually non-existent.

“I’m carefully looking at the number of Japanese tourists in our hotels at least, we have less than 10 a week,” he said.

Shin said the only Korean national carrier, Asiana Airlines, is pulling out and there’s no guarantee that it’s going to service the Saipan destination beyond June or July at this point.

“We’re trying everything to revive it. But again, all I’m saying is we’re also in struggle, but yet, we’re trying to do this because we have to be optimistic,” said Shin, referring to their proposed land lease renewal agreement with DPL regarding Coral Ocean Resort.

The E-Land Group CEO underscored the need to put an effort to bring tourism back to the island.

“Are we struggling? Absolutely,” he pointed out.

Shin said Hyatt Regency Saipan’s closure announcement was surprising but it wasn’t a big surprise for E-Land as they sort of sense that it will come down to that at a certain point.

Sen. Jude U. Hofschneider (R-Tinian) said they often hear that hotels on Saipan have 30% hotel occupancy rate and in order for the hotels to survive they need at least 80% occupancy rate consistently.

“We hear that a lot. I don’t know if that’s true, but that’s what I hear whether on the paper or were you or somebody else,” Hofschneider told Shin.

Shin said E-Land has been losing money for four years now and obviously COVID-19 was a big part of it.

He said they expect to lose more money this year.

Shin reiterated the need to put more effort to bring the tourism back, which is what they are trying to do.

“That’s why we never stopped investing throughout COVID. We believe that restoring our golf course after we got completely destroyed by [Super Typhoon] Yutu was important because we believe in that, you know, continuation of the venue for the CNMI was important,” Shin said.

Magofna thanked Shin, Mariana E-Land Corp. vice president Gloria Cavanagh, and E-Land Group for considering to stick around despite the economic condition that the CNMI is in right now.

Magofina said she wasn’t surprised when she saw the Hyatt closure message because the Hotel Association of the NMI and the Saipan Chamber of Commerce have consistently shared, when they come up to the Legislature or just talking to them in conversations, about the hotels’ situation.

“I’ve seen it on the newspaper where it was consistently reporting 30% [hotel] occupancy rates. So that is not a surprise at all. The writing has been on the wall all this time. We’re just you know, maybe some of us were just not paying attention,” Magofna pointed out.

She said to publicly come out and say that Hyatt’s closure announcement is shocking or surprising, “just weren’t paying attention, period.”

Magofna said, however, they don’t want to dwell on things like that as there is a need to figure out what the CNMI needs to do to get out of this.

The senator said one of the ways is to make sure that the government continues to foster good relationships with its current investors and continue to encourage more investors to come in.

“We need to nurture the ones who are already here and have invested into our community for quite some time. So that is definitely being taken into consideration,” Magofna said.

Magofna said in light of what Senate fiscal analyst Dave Demapan has raised during the meeting regarding the appraisal value of the Suwaso property that is overstated, she just wants to hear from both parties that they are fine with that.

“Knowing that facts now, because obviously it’s to our advantage that it’s overstated. But to be fair to Suwaso, I guess we just want to get it on the record, since we’re here, considering the proposal that you know, based on that new finding and information that we are okay to move forward. To be fair,” she said.