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If you zoom in to the satellite view on the map above, you'll see it's not an obvious place to build a hotel. But read these reviews from the 1950s and 60s, and imagine how it used to be:
I'm making a guess at the location for this, based on the address in a 1958 copy of the FEER as "4 1/2 Milestone, Taipo Road". [12 Oct 2010 UPDATE: I've set the correct location, based on comments below.]
The 1973 Hong Kong Who's Who gives us the 1956 completion date, and an accurate address which unfortunately no longer exists: NKIL 3744. If anyone can give better directions to its location, please let me know. I'm also interested to hear when it closed or at least the latest memory you have of it still open.