updated 2/22/2004 7:17:34 PM ET 2004-02-23T00:17:34

Giorgio Armani, the Italian fashion designer known for classy looking clothes collections, is teaming up with a Dubai-based company to launch a collection of luxury hotels and resorts.

In a statement Sunday, Giorgio Armani Spa said it signed a letter of intent for the project with EMAAR Properties PJSC.

Over the next seven years, 10 hotels and four vacation resorts will be opened in London, Paris, New York, Tokyo, Shanghai, Milan and Dubai, the statement said.

"We have been exploring the idea of bringing the Armani philosophy of design and style to hotels for many years," the designer was quoted as saying in the statement.

Armani, sole owner of his namesake company, and Emaar Chairman Mohammed al-Abbar told Dow Jones Newswires Saturday about the global chain entailing more than $1 billion in investments over the next six to eight years. Armani will oversee the hotels' design and styling.

Cash-rich Emaar, responsible for real estate and management, is likely to carry most of the development costs, though details of the financial arrangement haven't been completed.

"I'm leaning toward a royalties-type deal," al-Abbar, who approached Armani a little more than a year ago, when he learned Armani was considering opening a hotel chain, told Dow Jones.

Armani has long been expanding his horizons, from women's and men's clothing to home furnishings and other designer items.

Armani and al-Abbar are betting on an upturn in the tourism industry, after the terrorist attacks of Sept. 11, the SARS scare and an economic downturn discouraged traveling. Travelers, both for tourism and business, will always frequent the world's most important cities, Armani said.

Armani said his company would also benefit from selling merchandise to the hotels, including furniture, staff wardrobes and guest amenities such as toiletries.

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