1958-65: Creating the first Mandarin Hotel
In 1958, Hong Kong was a relatively quiet British Colony coping with effects of some changing political arrangements in China, hidden behind its borders. The population had grown to an unprecedented 2.5 million people. The Japanese occupation was still a topic of conversation. The territory was far more isolated in every sense than it is now. The economy was generally weak.
However, redevelopment had started, and the office demand exceeded the supply. The Hongkong Land Investment & Agency Company Limited, founded March 2, 1889, dominated the central office market, small as it then was.
Capital expansion was difficult to justify financially, especially in view of the company's policy with respect to rent. Many tenants were still enjoying rents below HK $1.00 per sq ft per month; 80c in the older buildings was quite usual. The tenants strongly resisted any attempted increase upon renewal.
As far back as 1946 the board had decreed that rents would be "fair and reasonable and not exploit the full scarcity value of premises." The company's fortunes were seen then "to be so bound up with those of the Colony that there could be no lasting benefit in going against the general interests of the community." This policy was genuinely respected and followed by the management.
The redevelopment of Alexandra House in 1956 had established a new rental plateau but still not much over a dollar a foot. The new Jardine House was occupied that year. It was not until Union House was completed in June 1962 that over $1.50 was being achieved, with much protest.
The Queen's and Prince's Buildings on Statue Square, acquired by the Land Company respectively in the 1923 and 1927, were still prominent and excellent locations. However, the days of the beautiful, turreted, turn of the century, colonial office buildings were obviously numbered. Lease renewals were already containing demolition clauses. Their redevelopment as modern office buildings was contemplated but difficult to justify economically.
But, Hugh Barton of Jardine had a dream!
Hongkong Land Company chairman, the Hon. Hugh Barton had already decided the Central District must have a world class hotel. Further, that the Land Company would build the hotel on the Queen's site. At the time this was an incredible leap of faith.
At the other end of Chater Road, Hongkong Land owned Gloucester Building which housed their renowned little Gloucester Hotel. A burned out hotel site had been bought in 1928 and two years later redeveloped as Gloucester Building.
The new building contained residential upper floors designed to be leased as an annex to the adjoining hotel owned by Hongkong and Shanghai Hotels. No deal could eventually be made and the Land Company was stuck with the hotel floors. Ironically, considering what transpired, it is reported by Bevan Field that "the company had to run the Gloucester Hotel until it was taken over by City Hotels Limited in 1961." By not taking the 1930 lease offer, another hotel company had also spawned a major competitor!
The Gloucester was a small local hotel with an handful of staff, none with formal hotel management training and far removed from the international standard envisaged for the new Queen's Hotel. The Land Company had no experience in hotel development nor in the level of management needed. Even so, enthusiastic arrangements were underway in 1958, to close the Gloucester and develop a first class hotel on the Queen's site.
At the Land Company office also in Gloucester Building, Bevan Field was General Manager, with Luk Man Lok as his assistant; James Martin was Estate Manager , John D'Eathe as Assistant Manager; Bob Baker was Secretary; Col Pepperdine supervised Construction; Bill Powell, Maintenance; and Gerald Graham ran Agency. Gloucester Hotel occupied the top floors of the building and was ‘managed’ by Vernon Roberts, a war time Gurka, but actually run by Au Lum. From a management point of view, that was about it ; the total office staff , including the hotel management, comprised about fifty people. From then on there was a steady staff buildup as the company commenced its expansion.
Early In 1959, the company brought in a hotel professional, Peter Costello for day to day running of the Gloucester hotel, assisted by Max Schnallinger (who later deserted to the new Hilton). These managers freed up Vernon Roberts for more general Land Company duties and planning the new hotel.
Catering and staff management were under contract to Au Lum, everyone's friend and fixer, who personally owned several catering establishments including the Gloucester arcade cake shop and restaurant, and the Aberdeen Sea Palace.
The appointed architects had started work on the design of an office building and hotel on the Statue Square sites buildings; Ian Campbell of Palmer and Turner for the office building and John Howorth of Leigh and Orange for the hotel. Models were made to ensure that the designs would complement each other and the existing buildings around Statue Square. Serious redevelopment arrangements were now underway.
City Hotels Limited was incorporated this year. Hongkong Land was in the process of finishing Union House Phase 1, and moving in the tenants, some from Queen's Building.
The decision was made to include a large retail component in the Prince's Building design to complement the Hotel. On the Queen's site demolition of the office building was completed and piling underway. The massive Typhoon Mary slowed things down for a month.
A problem with planning the redevelopment of Prince's Building was the number of significant tenants holding long leases, particularly banks on Des Voeux Road Central, an important banking location. It was thought the new Prince's Building would have to be built in two phases. This problem was later solved through patient negotiations and very helpful tenants.
The absolutely charming and quietly decisive Tony (T.A.P.) Ross, later to be the first Manager of the First Mandarin, arrived from The Mayfair, London, mid October 1960. He and Vernon Roberts now formed the team that would recruit staff and develop the Queen's Hotel.
In January 1961, the public offering of City Hotel Limited shares was made to Land Company shareholders, was fully subscribed and the new hotel project was under way. Barrister Maisie Chan of the Land Company Secretary's department had started working on the Queen's Hotel lease and general documentation with Peter Vine and Ray Moore of Deacons, lawyers. The lease was not actually signed until 1963.
By late February piling at Queen's was completed and the concreting of the basement had commenced. City Hotels took over the management of the Gloucester Hotel, leasing the space, buying all the hotel assets, and commencing management training.
During the early part of 1961 rumours were circulating regarding Bevan Field's successor as Land Company general manager. On 8 March, Vernon Roberts, confided to friends that he was slated for the position. This was significant, as he had emerged from the Hotel management team, and indicated the importance put upon the hotel side of the company. He had the confidence of the chairman Hugh Barton. Vernon chaired the hotel meetings, led the programme through to completion and personally had a great deal of influence on the quality and style of development.
However, the Queen's Hotel was by no means the Land Company's main focus. The construction of Union House Stage 2 was starting. 9 Icehouse Street; Edinburgh, Marina, Windsor, Alexandra, and Jardine Houses; and Gloucester Building all required managing. And a major movement of tenants was being planned throughout the central district properties to accommodate the demolition of Prince's Building, the sale of David House and the occupation of Union House.
By March 1962, Queen's Hotel structure was up to the second floor. At the annual meeting that month, A. Penn, a shareholder, is recorded as saying how pleasing it was to see the Queen's Hotel beginning after earlier growing pains, "situated on our most valuable site, and involving tremendous development costs, it undoubtedly represents our boldest enterprise to date," he said, adding dryly that he hoped the Land Company would negotiate an adequate lease return.
Plans for Prince's Building were well advanced with no phasing required due to the cooperation of long term tenants, particularly the banks. A new staff residential building was about the be built in the Western District to replace the quarters demolished in the central wells of Queen's and Prince's buildings and this would contain a laundry for the Hotel.
That month also saw the first tenant moves into Union House, phase 2, which was finally completed on late June for an upper floor occupation permit. Most tenants were in by the destructive Typhoon Wanda in August, fortunately with all the extensive bamboo scaffolding already down.
17 September 1962, the news was released that Queen's Hotel would be officially renamed The Mandarin Hotel. (The American Hotel competition was now almost finished up the hill, but not yet named The Hilton.) Chairman Hugh Barton and now City Hotels chairman Harold H. W. Lee, continued to take a close personal interest in the hotel development.
The peace of the Land Company office was shattered on 16 November 1962 when a large crowd of wailing women descended upon the office to demand employment at the new hotel. These were the redundant cleaners from Prince's and other buildings, who had just been told by Au Lum, for the Mandarin, that they would not be up to providing the superior quality of service needed. Of course, the Hotel group said this was a Land Company problem.
By the end of November 1962, Prince's Building had been cleared of tenants and some areas of the lower street fronting space at the Mandarin were habitable. Nan Yang, and Farmers Banks had moved from Des Voeux Road into temporary quarters there, maintaining their Prince's lease terms. The old office building was cleared and demolition began in December.
As 1963 dawned the rush was already on to complete and open the Mandarin by the September target date. It did not seem possible. The exterior building structure was almost finished but the roof was actually put not on until March that year The interior had a very long way to go. Next door, Prince's Building was a dust bowl, demolished down to the second floor.
The hotel lease was finally signed in early 1963, but only half the rental was charged in the first six months as a quid quo pro for the temporary bank space provided.
On 5 March it was announced by Hugh Barton that Vernon Roberts would be Bevan Field's successor in the New Year. Bevan Field still had hands on control of the Prince's construction meetings which involved Col Pepperdine, the estate department, Palmer and Turner architects and consultants. Vernon had the responsibility for the Mandarin, with Tony Ross and Bill Powell.
The Land Company estate department was busily leasing the new Prince's Building, but also designing and leasing the retail areas in both buildings. The retail centre overall was being planned and coordinated by both teams of architects as one functioning unit. The intended bridge over Chater Road linking the shopping malls, was of course a key part of that plan. A great deal of attention was given to making the bridge design appear light and inviting, resulting in the top hung structure.
Tony Ross, of course, was concerned with every design and construction detail on behalf of City Hotels. John Howorth, assisted by Frank Eckermann, of Leigh and Orange architects worked closely with interior designer, Don Ashton, Italian ceramist and sculptor Antonio Casadei, and artist Gerard D'A Henderson.
For John Howorth, a local establishment architect, the hotel was an incredible commission. Calm and businesslike, he was not only responsible for the magnificent interiors, designed in partnership with Don Ashton, but of course for the entire structure and all the working parts of the building.
Internationally renowned, interior and set designer Don Ashton, was urbane and polished. The public rooms he designed with John Howath were colourful and stunning. The finished Mandarin was well in excess of any standards existing in Hong Kong at the time.
Gerard, a flamboyant, exciting young person was furiously painting panels for installation in the hotel the moment they were finished. Already a well established artist in Europe, he had been commissioned and brought from Spain by Don Ashton. He painted energetically in a chaotic, hot, paint splattered studio provided for him in Gloucester Building. He was also an outstanding professional musician.
Antonio, a versatile and highly talented artist was a much calmer person and a businessman. He worked from his well organized studio in Kowloon Tong, providing a wide variety of artistic works for both the Mandarin and Prince's.
The competitor on the island, the Hilton Hotel opened just ahead of the Mandarin in May 1963, featuring its quickly popular Eagles Nest Bar, but providing a much lower standard of finish.
Gloucester Hotel was closed in October and converted into offices, accommodating some tenants from David House and 37/40 Connaught Road Central, which were sold to help pay for the new buildings.
Hongkong Land office rents had reached HK$ 1.50 per sq ft in the new Union House. A new policy was established by the board to push rents up to $2.10 to $2.60 ,ndepending upon the building, over a 1-5 year period. nThis was the adopted "standard rent." and provoked a bitter reaction by some tenants over the following months as the policy was implemented. Land Company desperately needed to raise rental levels generally to explain those now being negotiated in the new Prince's Building and to justify its capital expenditures generally. Other owners were helping by charging much higher rents.
Retail space in the central district was renting at $5 per month and was targeted at $12. The Hilton had reportedly rented shops at $20 per sq ft, an unbelievably high figure. These were Hong Kong dollars! It should be noted that 1962 and 1963 were slow business years and leasing generally was not easy.
In May 1963 the piling had started at Prince's Building but next door a panic was setting in to complete the hotel by September. It was becoming obvious this would not happen. The big management topic was not just the timing but controlling the escalating costs.
Another serious problem that year was water shortage. Fortunately, while avoiding a typhoon, the summer season brought torrential rain.
In anticipation of the opening, Volume 1 Number 1 of the Mandarin House magazine was published, with the young Maggie Keswick as assistant editor. The interiors are shown as Ashton illustrations, the hotel exterior picture still with scaffolding in place, and Casadei and Henderson are shown in their studios. Hugh Barton is shown with a satisfied smile on his face.
However, by midsummer, just before his hotel was quite finished, Hugh Barton retired and left the Colony. The 2000 invitee party for him on 13 June at the recently opened City Hall across the Square, had to be cancelled due to the water shortage. He did get to show his very human side by singing a rousing baritone ditty at his Football Club farewell. Michael Herries took over as Hongkong Land chairman.
After furious debate it was decided on 29 August that the Mandarin would still open in September but unfortunately not with a grand flourish. It would be opened quietly in stages, as finished: first the Lobby, the ground floor, the Button restaurant and pool patio on the roof, and some room floors; later the Grill and Harbour room, the Chinnery and so on floor by floor, as they were finished. Sadly the beautiful Casadei blue tiled open roof pool, (rather embarrassing anyway in a Colony so short of water) was in later years converted into a much needed water tank!
Local staff hiring for the hotel was well advanced. There was another noisy and heated assault on the Land Company office this time by a crowd of long term Gloucester Building employees who were being let go and not offered replacement jobs at the Mandarin.
At the end of 1963, externally the hotel was finished, the piling at Prince's Building was done and lower floor concrete was being poured. The Mandarin had cost HK $ 41.5 million to build, and $25 million, essentially the subscribed capital, to furnish and outfit. While all these costs were later justified there was considerable concern being expressed at the time!
The Mandarin was fully open in early 1964, but neither the mezzanine floor shops nor the bridge to Prince's Building yet existed. It would be another eighteen months before that facility was available. The hotel was still being opened by long stages!
In January 1964, Vernon Roberts became Land Company General Manager, although Bevan Field stayed on the Board. Tony Ross was now in his glory managing the leading hotel in the colony, supported by Peter Costa, Ernst Muller, Tony Basto, long time Land Company contractual associate Au Lum and many others. However, 1964 and 1965 were general recession years and hotel business was not easy. The association with Intercontinental Hotels was in operation.
That year the Land Company celebrated its 75th anniversary and Bevan Field was asked to produce a company history.
The long needed renovation of the Alexandra Arcade was now being designed to strengthen central district retail, and Prince's was out of the ground and growing steadily.
In May 1964, the estate department started working with Frank Eckermann of Leigh and Orange, to plan the detailed layout and design of the Mandarin mezzanine shops. The overall tie in to the Prince's retail centre via the bridge had of course, long been planned.
It took until October to produce a mock up of the shop fronts and line up several tentative tenants. The recession was making leasing surprisingly difficult both in the hotel and the office building. In September Typhoon Ruby had slowed everything down for a month. Renewals and new lettings were difficult enough without the new rental levels for which the Land Company was striving.
Still, Bevan Field, surprisingly accepted an invitation to a private dinner and quietly expressed satisfaction at the Land Company progress under his leadership; something of which he could be justly proud. He was a very private and reclusive man; and an hero during the Japanese invasion. ( Bevan later moved to Victoria, British Columbia where he lived a happy retirement.)
Now however, in 1964, Vernon Roberts was in charge: extroverted, emotional, friendly, quick to decide, a ‘Jardine’ man; everything Bevan was not. A change of pace! But most of the work at that time was just completion: finish and occupy all the hotel and Prince's; build the bridge; lease the shops; link the buildings.
The banks temporarily accommodated on the Mandarin ground floor, were returned in November to their previous location in Prince's Building, complete with vaults, on the Des Voeux Road banking street. This finally allowed the proposed Mandarin ground and mezzanine floor shops to be available for hotel rental.
The most expensive Mandarin shop finishes option, was chosen by Tony Ross and Vernon in December 1964. Estate Management started serious leasing negotiations, signing the first leases in January 1965. By the end of February the Mandarin shops were nearing completion with handovers in March.
April 5 1965 found the Mandarin shops well enough occupied, for a full Land Company board inspection, followed by a Board luncheon, of course, at the hotel. Present were Messrs. Herries, Clelland, Benson, Field, Lee, and Vernon Roberts with his senior management. Except for some stubborn back space all the shops were rented by May. Demonstrating the struggle to find tenants, one shop had already failed and closed by September.
Prince's Building was officially finished by May 1965, most tenants had moved in by the end of June and the bridge to the hotel was in regular pedestrian use. No expense was spared with extensive use of Italian marble and granite, both internally and externally, set off by Casadei's artistic decorative panels and chandeliers, all designed to complement the hotel.
Credit for much of the style of the Prince's Centre went to Ian Campbell and Malcolm Purvis, of Palmer and Turner, as did the design of the essential bridge. The pedestrian flow throughout both buildings was carefully planned with access to the shops and office tower segregated.
There had been concern that pedestrians would flow in volume over the bridge on their way to the Star Ferry. This was thwarted by the daunting expensive design and stationing of fierce-looking, uniformed doormen at the bridge entrance during rush hours.
From a Hongkong Land company point of view, the redevelopment of the Queen's and Prince's sites had always been a comprehensive venture. So, it could now finally accept that the Mandarin was completed. Then came a September pounding by Typhoon Agnus.
An attempt was made to get a license to install the latest technology, a closed circuit television system, but this was denied by the government. Even so, the Land Company could claim the most modern and beautifully decorated shopping mall in Hong Kong. Henry Steiner was hired to produce logos and design promotion material. The estate department set about organizing both Mandarin and Prince's shop tenants to participate in joint advertising campaigns, promotions, fashion events etc.
Bevan Field's ‘Short History’, was published and distributed to shareholders in 1965. He comments upon the necessary sale of David House and adjacent property " in view of the heavy commitments for the redevelopment of the Queen's and Prince's building sites and to the very low return received."
However, the entire central district properties had been anchored and improved by two splendid buildings. New very high standards had been set. Also, the total central district rents collected. according to the current rent roll, was only 65% of the targeted "standard" market rent. The catch up to market on rental income had a long way to go. The Land Company was still faithful to the 1946 directors' instruction to act reasonably on rentals in the interest of the economy generally.
Prince's Building was the last of the Land Company's older generation of pre-war properties to be rebuilt, completing their planned redevelopment programme. "At least for the time being," adds the Annual Report, prophetically.
Meanwhile, H.W.Lee the City Hotel's chairman was able to report at his Annual Meeting in October, that "the hotel was completed according to the original plans, with the installation of some fine shops." He went on poetically, suggesting that tourism and retail business might well improve in the future. At the end of the first full year of operation the hotel was breaking even, had expended all of the $25 million shareholder funds but had no debt. The net income earned by the company for the year was HK$2 million - but the chairman added he believed earnings," should continue to show improvement."
And so, with the final completion of the First Mandarin Hotel, Hugh Barton's dream had become a reality. Across the nearby border another ‘Mandarin’ was launching his Cultural Revolution.
John D’Eathe, West Vancouver, April 2022.
As Deputy Estate Manager at Hongkong Land, which envisaged and opened the first Mandarin, John D’Eathe was involved in all their Central development during that period.