Exclusive: Stalled for over a year, L7 Cheongnyangni hotel to open in March

L7 Cheongnyangni by Lotte, a hotel that failed to open last year due to a contract dispute between operators, is preparing to launch in March. A new investor has acquired the property, and Lotte Hotel HM — Hotel Lotte's hotel management subsidiary — is set to take over operations. The property is expected to become Lotte Hotel HM's second domestically managed hotel, following the formal opening of L7 Gwangmyeong in June.

According to hotel industry sources Monday, Lotte Hotel HM is recruiting a general manager and head of rooms operations, among other staff, in preparation for the March opening. Hyundai Haim Asset Management is the hotel's owner, and Lotte Hotel HM is set to handle management under a contract operations arrangement.

Under a contract management model, a hotel owner entrusts day-to-day operations to an outside specialist. The arrangement allows hotel operators to expand their footprint using their brand and operational expertise without bearing the upfront costs of purchasing or developing real estate — a widely used asset-light strategy among global hotel companies.

L7 Cheongnyangni is a 260-room hotel located in the Lotte Castle SKY-L65 landmark tower near Cheongnyangni Station in Dongdaemun-gu, Seoul. Hotel Lotte had originally planned to open the property last May under a contract management arrangement, with real estate operator Seoul Investa handling construction and operations while Hotel Lotte provided the L7 brand and operational know-how.

The opening fell through when a dispute over contract payment settlements arose between Seoul Investa and parties involved in the Cheongnyangni redevelopment project. The conflict dragged on, preventing the hotel from beginning normal operations. In September, a private equity fund managed by Hyundai Haim Asset Management acquired the hotel facility, and Hotel Lotte agreed to take on contract management through Lotte Hotel HM.

Lotte Hotel HM is a hotel management subsidiary that Hotel Lotte established in February to expand its contract operations business. Its first domestic contract property is L7 Gwangmyeong by Lotte Hotel in Gwangmyeong, Gyeonggi Province, which began a soft opening in March and formally opened in June. Once L7 Cheongnyangni opens, Lotte Hotel HM will operate two hotels domestically under contract.

Hotel Lotte operates brands including Signiel, The Grand Lotte, Lotte Hotel, L7 by Lotte Hotel, Breve by Lotte Hotel and Lotte City Hotel. This year, the company has been expanding its portfolio by rebranding Lotte Hotel Seoul as the high-end "The Grand Lotte Seoul" and introducing the new "Breve by Lotte Hotel" brand.