Regal Hotels International (0078) has reportedly put its Regal Oriental Hotel in Kowloon City up for sale for about HK$1.5 billion, and the property is estimated to be redeveloped into student accommodation.

Regal is said to have appointed a surveyor to handle the sale. The 494-room hotel, offering a total gross floor area of about 243,000 square feet, is valued at roughly HK$6,172 per sq ft, or about HK$3 million per room, according to local media reports.

Completed in 1982 and originally named the Regal Airport Hotel due to its proximity to the former Kai Tak Airport, the property was later renamed Regal Kai Tak Hotel before taking on its current name in 2002.

Part of the hotel has already been converted into a youth hostel under a government-supported scheme, providing 80 rooms with two bed spaces each, at monthly rents of HK$4,500 to HK$4,650 per bed space.

The current administration has expanded the youth hostel scheme to subsidize non-governmental organizations in converting hotels and guesthouses into dormitories, aiming to add around 3,000 bed spaces within five years.

The city has seen more than 10 residential or hotel deals totaling over HK$3 billion in the past two months, reflecting renewed investor appetite for hotel-to-dormitory conversion opportunities and a rebound in residential rents.

In August, Wang On Properties (1243), together with a fund, bought the 199-room Hotel Ease Mong Kok for about HK$430 million, with a gross floor area of roughly 49,000 square feet. The company said the hotel’s proximity to an MTR station makes it particularly appealing to student tenants. Combined with another project, Wang On expects to launch about 1,800 bed spaces next year.

Regal Oriental Hotel on sale for $1.5 billion, might be turned to student accommodation