Prague approves Ritz-Carlton Hotel project

The plan to join eight buildings near Old Town Square in on again

The Prague City Council decided Tuesday to allow a controversial hotel project adjacent to Old Town Square to continue. At the end of 2017, the project seemed to be definitively canceled when the city withdrew from the contract, as the terms were not fulfilled.

A new deal has been made. The Ritz-Carlton Hotel, now set to open at the end of 2022, will offer about 90 rooms. The investor has also promised the city that it will also build 26 luxury apartments for rent. This is to keep in line with rules for residential housing for the protection of UNESCO World Heritage sites.

The hotel will be made from joining eight historical houses between Železná, Celetná and Kamzíková streets. The luxury hotel will be the first Ritz-Carlton in the Czech Republic.

The ground floor of the main building at Celetná, called U Sixtů, will have several small shops.

Part of the property is owned by investor Akroterion but other parts are the property of the city, and the company has use of them in long-term lease up to 2081.The Ritz-Carlton chain has an agreement to operate the hotel once it is built.

“I'm really expecting to start construction work at the beginning of next year,” Ogi Jakšič CEO of investor Akroterion, told daily Pražský deník.

Prague withdrew from a contract with the investor last year because the investor did not meet the condition to repair the dilapidated buildings by September 2017. The city has now extended the deadline for completion of construction until 2022.

The investor also offered a 7 percent increase in rent for the city-owned houses. Akroterion did not disclose the total for rent. The new contract also includes the payment of a Kč 10 million fine for the delay in the project.

The cost of renovations was previously estimated at up to Kč 2 billion crowns.

City Councilor Karel Grabein Procházka (ANO), responsible for property, said Akroterion has shown its readiness by acquiring valid building permits and providing financial guarantees.

“The loan is pre-arranged and cooperation with the international Ritz-Carlton hotel network is already under way,” Jakšič said. The investor is cooperating with Ritz-Carlton architects on the interior design.

Prague worked with the consultancy company B.I.R.T. Group in 2017 to examine several options about what to do with the properties.

The city concluded that since the properties were in such poor condition, it would be best to continue with the existing investor and project, rather than start over from scratch with a new investor. This way, the properties can be renovated in a faster timeline.

Deputy Mayor Petra Kolínská (Greens) said she appreciates the new promise from the investor that the public will be able to use previously unavailable internal parts of the houses.

The National Monument Institute (NPÚ) has opposed the project, and there have been several petitions against it. The NPÚ claims there are enough hotels in the area already. They also opposed specific details in how the buildings would be joined. Jakšič said a compromise has been worked out that satisfied the NPÚ.

The plan to join the buildings was first suggested in 1995.

Akroterion is a subsidiary of the multinational real estate group Golden Star Estate, which owns the five-star Marriott Hotel in Warsaw, as well as properties in London, Frankfurt. Golden Star Estate is completing the acquisition of an administrative center in Prague 5.

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