The alternative website would not be interested in this piece of news : GIC Real Estate sells Sydney’s Shangri-La Hotel for record $423m

The alternative website would not be interested in this piece of news. They would only report bad news. The alternative websites and certain party in red are only satisfied if our SWFs are bankrupted.

by Fabrications About The PAP 

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GIC Real Estate sells Sydney’s Shangri-La Hotel for record $423m

VETERAN hotel investor GIC Real Estate has sold Sydney’s Shangri-La Hotel for a record price of A$330 million (S$423 million), to Hong Kong-listed Shangri-La Asia.

Shangri-La Asia, controlled by the Kuok family, is paying A$330 million for the company that holds the property. It will also put up another A$22.4 million for the net current assets of the company which are mostly in the form of cash.

Shangri-La Asia had been managing the property for GIC Real Estate, but made the purchase in order to gain full control.

‘The company considers that the acquisition is a good opportunity for it to obtain full control of the hotel and to strengthen its presence in Australia,’ Shangri- La Asia said in a statement to the Hong Kong Stock Exchange last Friday.

According to the Australian Financial Review (AFR), GIC Real Estate, a part of the Government of Singapore Investment Corp, will be reaping a hefty profit from the sale.

It had bought the leasehold property, which was then the ANA Harbour Grand Hotel, in 2002 for A$206.5 million.

The latest deal reflects a room rate of about A$586,000, up from GIC’s purchase price of about $368,000 per room 10 years ago.

The 36-storey hotel has benefited from several upgrades, including a A$20 million refurbishment last year, the AFR said.

Buyers from Asia have been flocking to Australia to buy up hotels, the newspaper added.

Mr Craig Collins, the head of Australasia at property consultancy Jones Lang LaSalle Hotels, which advised GIC on the Shangri-La sale, expects about A$1.4 billion of Australian hotels to change hands this year.

Earlier this month, Malaysia’s YTL Corp bought a portfolio of Marriott hotels in Australia for A$415 million.

Buyers from Asia account for more than 90 per cent of purchases this year, the AFR said, with many hunting down purchases in cities where hotel occupancy rates have been strong, such as Sydney.

Hotel occupancy rates in Sydney are the highest in Australia.

The Straits Times – June 27, 2012

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Comments  from  Fabrications About The PAP 

  • 10 years 100 million profit is 50% so 5 percent a year. Is it really hefty profit?
  • you don’t make sense. The A$150-odd million in profit is purely profit from capital gains (i.e. not including the operating profits the hotel makes every year).
    It’s approx. a 70% return on investment in 10 years – of course it’s a hefty profit.
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