AP COVID Hospitality Bulletin Asia-Pacific

Source: Source: AP Hospitality Advisors

Source: Source: AP Hospitality Advisors

Transactions that matter.

1. Grand City Hotel Sai Wan & Bay Bridge Lifestyle Retreat, Hong Kong

  • Based in Hong Kong weave life partnered with a US fund manager Angelo Gordon take over the Grand City Hotel in Sai Wan from the Hong Kong list Magnificent hotel investments. The 214 keys ownership changed hands at 900 million HKD (115 million USD) Where 4.2 million HKD (537,000 USD) by key. As Weave Living’s third acquisition in 2022, the property would be reallocated to a co-ownership and is expected to open in the third quarter of 2023.
  • Strategically located in Sai Wan, a short distance from Central and the University of Hong Kong, the Grand City Hotel opened in 2015 with an F&B outlet and several parking spaces; the property has been temporarily converted into a designated quarantine facility since February 2022. The property was valued at HKD 770 million at the end of December 2021, and the seller expects to have cash inflow of HKD 530 million from the transaction. About 20% of the cash flow generated would be used for the operation of the group, and the rest would be the reserve fund for future acquisitions.
  • Shortly after the sale of Grand City Hotel, Magnificent Hotel Investments announced its acquisition of the 435 Unit Bay Bridge Lifestyle Retreat at 1.42 billion HKD (181 million USD) Where 3.26 million HKD (416,000 USD) per key of Tang’s living group. Tang’s Living Group took over the property in 2017 from Gaw Capital for HKD 1.68 billion in 2017 (who bought it from Hang Lung in 2012 for HKD 1 billion) and put it up for sale at an asking price of 2 HKD.38 billion in 2020. The property will cease operations when the transaction is completed in October 2022; the buyer has not yet disclosed any new plans for the property.
  • Located in Tsuen Wan, Bay Bridge Lifestyle Retreat offers full facilities and amenities and is currently operating as a designated quarantine facility since March 2022. Prior to the changes, the property was partially renovated and renamed Commune, which converted 48 rooms into co-living space offering 192 beds in 2017, while the rest was operated as serviced apartments.

2. Hilton Sydney, Australia

  • The 587 Hilton Sydney Keys was sold to Baring Private Equity of Brilliant Ruby Resources for 530 million AUD (365 million USD) Where 900,000 AUD (622,000 USD) per key. The sale of Hilton Sydney set a new record for a single hotel transaction in Australia. Located in the heart of Sydney’s CBD, the hotel was first built in 1974, followed by reconstruction as part of a major project in 2005. Despite suffering from lockdown and dwindling traveler numbers, the hotel has undergone a major, AUD 25 million, multi-year refurbishment of rooms and other amenities.
  • The seller, Bright Ruby Resources, acquired the property for AUD 442 million in 2015 from Hilton Worldwide, which was Australia’s largest hotel transaction at the time. Bright Ruby is said to be backed by Chinese investors, and it also had several property investments, including 2 office towers in Sydney. The deal involves the continued disposal of overseas assets by Chinese investors, and several Chinese developers are reported to be abandoning ongoing development projects ranging from residences to offices in Australia.

3. Six Senses Fiji

  • Six Senses Fiji was sold to Sequitur Resorts after restructuring, and it will be operated primarily by local staff under the management of Six Senses. Completed in 2018, the luxury resort has 24 villas in western Malolo Island with great exclusivity and accessibility from the main island, but was temporarily closed for two years due to COVID-19. The property reopened in April this year after Fiji opened its border in December last year.

show deal

  • The sellers of Hyatt Regency Tokyo are close to an agreement according to the local press, and the hotel is likely to be sold to an asset manager, KKRby a Japanese developer and transportation giant, Odakyu Electric Railway. Although the details of the deal are unclear, the price is speculated at around 100 billion JPY (867 million USD) for the hotel and adjacent office building.
  • The newly opened Sofitel Adelaide 251 keys is for sale by a local promoter, Palumbo Group. Opened in November 2021, the hotel is operated by Accor, and it’s also the city’s latest luxury hotel after the Intercontinental opened decades ago. Although no details of the sale are disclosed at this stage, it is expected to attract domestic and overseas investors as tourism activity picks up in South Australia.
  • The Hotel Rio 449 keys in Macau would be for sale 2 billion MOP (247 million USD) Where MOP 4.45 million (USD 550,000) per key with its casino, according to local media. The hotel is owned and operated by Galaxy Entertainment Groupand it was opened in 2006. Local media also reported that the hotel’s spa, Rio Hotel Macau Sauna Place, has suspended operations since April due to renovations.

The COVID news that matters

Australia

  • By fully opening its border in February, the Australian hotel and tourism industry is gradually recovering. The latest figure released by the Bureau of Statistics suggests that the number of overseas arrivals rose to 0.58 million in April, about a third of the comparable figure before the pandemic; the top three source markets for short-term visitors are the UK, New Zealand and India.
  • Regional governments across Australia are boosting local tourism through a variety of initiatives. The state government is planning an investment of AUD 45 million to boost tourism in South Australia (SA), including supporting the recovery of tourism and investing in a new SA tourism marketing campaign. Tourism activity is recovering well from the losses due to the pandemic, with the average hotel occupancy rate reaching 79% in April, the best month since the pandemic.

Japan

  • After closing its border to leisure travelers for more than two years, Japan announced it would reopen to tourists from 98 countries and regions but only allow the package tour format from June 10. The eased restrictions were announced after a successful trial of small-group tours with visitors from the United States, Australia, Thailand and Singapore in May. Triple-vaccinated travelers from certain countries would be exempt from the 3-day quarantine with a negative test result upon arrival. Japan would also increase the number of airports handling international flights to seven at the same time, and new destinations include Naha in Okinawa and New Chitose in Hokkaido.
  • Despite border closures since 2020, Japan still ranks first in the World Economic Forum’s 2021 Travel & Tourism Development Index (TTDI). The newly established frameworks have been adapted from the previous Travel and Tourism Competitiveness Index, but with greater emphasis on the sustainable and resilient development of travel and tourism in a country, and Japan has top scores thanks to its robust infrastructure and its hotels welcoming international travellers. .

Laos

  • Laos, a landlocked country in Southeast Asia, finally opened its border to international visitors in early May and electronic visa applications are also available for eligible travellers. The relaxed entry rules would allow travelers to travel across the country across the country without limitations on destinations or hotels. Before the full reopening, travelers were only allowed in designated “tourist green zones”, including the capital Vientiane and the northern city, Luang Prabang, which had more than 99% vaccination rate.
  • Laos’ reopening is relatively slow as China, one of its biggest inbound tourism markets, remains under tight border controls. However, Thai tour operators have returned to assess the possibilities of organized tours in Laos. At the same time, the government is working to develop new travel experiences and new destinations across the country. For example, Xing Xou Island, an island community in the middle of the Mekong, is heralded for tourism development as the country’s latest cultural heritage.

Asia-Pacific reopening status

After the announcement of reopening from Japan and Laos, only four countries and regions exercise strict border control, including China, Hong Kong SAR, Macao SAR and Taiwan.

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