Hotel Haegumgang: The sad and surprising story of North Korea’s floating hotel

Jacopo Prisco, CNN

(CNN) - It was once an exclusive five-star resort floating directly over Australia's Great Barrier Reef. For years, it sat dilapidated in a North Korean port, a 20-minute drive from the Demilitarized Zone, the restricted area that separates the two Koreas.

For the world's first floating hotel, that's the last stop in a bizarre 10,000-mile journey that began over 30 years ago with glamorous helicopter rides and fine dining, but ended with a tragedy.

Although there was hope that the floating hotel, a centerpiece of the Mount Kumgang resort area, might be able to have another life, that proved not to be the case.

Intelligence reports in South Korea say that the floating Hotel Haegumgang was among the sites destroyed by the North Korean government in 2022, along with Onjonggak Rest House, where televised reunions between separated relatives from both sides of the DMZ previously took place.

Here's more about the significance of Mount Kumgang and why the floating hotel might be gone forever.

It's a sad end to a long and colorful story, which continues below.

A night at the Reef

The floating hotel was the brainchild of Doug Tarca, an Italian-born professional diver and entrepreneur living in Townsville, on the northeastern coast of Queensland, Australia.

"He had much love and appreciation for the Great Barrier Reef," says Robert de Jong, a curator at the Townsville Maritime Museum. In 1983, Tarca started a company, Reef Link, to ferry day-trippers via catamaran from Townsville to a reef formation off the coast.

"But then he said: 'Hang on. What about letting people stay on the reef overnight?'"

Initially, Tarca thought of mooring old cruise ships permanently to the reef, but realized it would be cheaper and more environmentally friendly to design and build a custom floating hotel instead. Construction began in 1986 at Singapore's Bethlehem shipyard, a subsidiary of a now defunct large US steel company.

The hotel cost an estimated $45 million -- over $100 million in today's money -- and was transported by a heavy-lift ship to the John Brewer Reef, its chosen location within the Great Barrier Reef Marine Park.

"It's a horseshoe-shaped reef, with quiet waters in the center, so ideal for a floating hotel," says de Jong.

The hotel was secured to the ocean floor with seven huge anchors, positioned in such a way that they wouldn't damage the reef. No sewage was pumped overboard, water was recirculated and any trash was taken away to a site on the mainland, somewhat limiting the environmental impact of the structure.

Christened the Four Seasons Barrier Reef Resort, it officially opened for business on March 9, 1988.

"It was a five-star hotel and it wasn't cheap," says de Jong. "It had 176 rooms and could accommodate 350 guests. There was a nightclub, two restaurants, a research lab, a library and a shop where you could buy diving gear. There was even a tennis court, although I think most of the tennis balls probably ended up in the Pacific."

A whisky bottle

Getting to the hotel required either a two-hour ride on a fast catamaran, or a much quicker helicopter ride -- also more expensive, at an inflation-adjusted $350 per round trip.

The novelty of it all generated quite a buzz at first, and the hotel was a dream for divers. Even non-divers could enjoy incredible views of the reef, thanks to a special submersible called The Yellow Submarine.

However, it soon became clear that the impact of bad weather on guests had been underestimated.

"If the weather was rough and you had to go back to town to catch a plane, the helicopter couldn't fly and the catamaran couldn't sail, so that caused a lot of inconveniences," says de Jong.

Interestingly, hotel staff lived on the top floor, which in a floating hotel is the least desirable location because it swings around the most. According to de Jong, staffers used an empty whisky bottle hanging from the ceiling to gauge the roughness of the sea: when it started to sway out of control, they knew a lot of guests would be seasick.

"That was probably one of the reasons why the hotel was never really a commercial success," he says.

There were other problems: a cyclone struck the structure just one week before opening, damaging beyond repair a freshwater pool that was part of the complex. A World War II ammunition dump was found two miles from the hotel, scaring off some customers. And there wasn't really much to do besides diving or snorkeling.

After just one year, the Four Seasons Barrier Reef Resort had become too expensive to run, and closed down without ever having reached full occupancy.

"It disappeared really quietly," says de Jong, "And it was sold to a company in Ho Chi Minh City in Vietnam, which was looking to attract tourists."

An unlikely destination

In 1989 the floating hotel embarked on its second journey, this time 3,400 miles northward. Renamed Saigon Hotel -- but more colloquially known as "The Floater" -- it remained moored in the Saigon River for almost a decade.

"It became really successful, and I think the reason was that it was not in the middle of nowhere but on a waterfront. It was floating, but it was connected to the mainland," says de Jong.

In 1998, however, The Floater ran out of steam financially and closed down. But instead of being dismantled, it found an unlikely new lease of life: it was purchased by North Korea to attract tourists to Mount Kumgang, a scenic area near the border with South Korea.

"At that time, the two Koreas were trying to build bridges, they were talking to each other. But many hotels in North Korea weren't really tourist friendly," says de Jong.

After another 2,800-mile journey, the floating hotel was ready for its third adventure, with the new name of Hotel Haegumgang. It opened in October 2000 and was managed by a South Korean company, Hyundai Asan, which also operated other facilities in the area and offered packages for South Korean tourists.

Over the years, the Mount Kumgang region attracted over 2 million tourists, according to Hyundai Asan spokesman Park Sung-uk.

"Also, Mount Kumgang Tour improved inter-Korean reconciliation and served as a pivotal point for inter-Korean exchange, as the center for the reunion of separated families to heal the sorrows from national division," he says.

A tragedy

In 2008, a North Korean soldier shot and killed a 53-year-old South Korean woman who had wandered beyond the boundaries of the Mount Kumgang tourist area and into a military zone. As a result, Hyundai Asan suspended all tours, and Hotel Haegumgang shut down along with everything else.

It's unclear whether the hotel has operated at all since then, but certainly not for tourists from South Korea.

"Information is sketchy, but I believe the hotel was operating only for members of the North Korean ruling party," says de Jong. On Google Maps, it can still be seen moored at a pier in the Mount Kumgang area, rusting away.

In 2019, North Korean leader Kim Jong-Un visited the Mount Kumgang tourist area and criticized many of the facilities, including Hotel Haegumgang, for being shabby; he ordered the demolition of many of them as part of a plan to redesign the area to a style more fitting to North Korean culture.

In the meantime, the floating hotel's legacy still intact. It will likely remain one of a kind, as the idea of floating hotels hasn't really caught on.

Or -- in a sense -- it has.

"The ocean is full of floating hotels," says de Jong. "They're just called cruise ships."

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