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08-06-2013, 11:21 PM
S’poreans snap up hotels Down Under
conRAD RAJ Editor-at-Large Conrad Maria Jayaraj
722 words
31 May 2013
TODAY (Singapore)
TDAYSG
English
© 2013. MediaCorp Press Ltd.
SINGAPORE — Singaporean and other Asian investors are piling into the Australian hospitality sector, accounting for as much as 80 per cent of the investment in the property segment there, as cooling measures and low returns back home drive them overseas for higher yields.
“Asia-based investors, including Singaporean, Malaysian and Hong Kong interests, will continue to dominate hotel acquisition activity this year, attracted by consistently strong and stable total returns relative to other regions in the Asia-Pacific,” said Mr Stephen Burt, the newly-appointed Sydney-based Managing Director of Hotels, Asia Pacific at property consultancy Colliers International.
Asian investors account for 70 to 80 per cent of the purchasers of Australian hotels in the past three years, and many of them are Singaporean, drawn by yields that typically range from “6 to upwards of 8 per cent”, Mr Burt told TODAY. Spurred by this strong interest, Colliers plans to set up a dedicated hotel unit here. “We already have a specialist in Hong Kong and are in the process of appointing a person here in Singapore,’’ he said.
He has assembled a team of about nine in Australia.
More than A$1.25 billion (S$1.52 billion) worth of hotels in Australia changed hands last year with Asian investors, up 30 per cent from 2011. The largest single transaction was the A$330-million sale of the Shangri-La Hotel in Sydney by the Government of Singapore Investment Corp to Malaysian tycoon Robert Kuok’s Shangri-La group.
A portfolio of three Marriott Hotels was sold by Australia’s Commonwealth Managed Investments for A$415 million to Malaysia’s Starhill Reit controlled by tycoon Francis Yeoh of the YTL group.
Mr Burt, as Chief Executive of Mirvac Hotel Group, was instrumental last year in transferring 49.2 per cent ownership of Mirvac Wholesale Hotel Fund (since rebranded as the Ascendas Australia Hospitality Fund), comprising seven hotels in Sydney, Brisbane, Cairns and Melbourne, to a group of investors led by Singapore’s Ascendas Group for A$327 million. Ascendas also bought the 300-room Esplanade Hotel in Fremantle for A$90 million.
Last July, Singapore’s Straits Trading Company acquired the Rendezvous Grand Hotel in Melbourne for A$61 million from Australia’s Challenger Life Nominees. Straits Trading Company also owns two other Rendezvous hotels in Australia.
The rising number of visitors to Australia has led to a surge in hotel construction. More than 6.1 million tourists visited Australia last year, including 340,000 from Singapore, pushing the average national hotel occupancy rate up one percentage point to 75.5 per cent. According to Colliers, the supply of new hotel rooms across Australia is expected to “rise markedly” over the next few years.
Singapore’s Royal Group, headed by Mr Ashok Hiranandani, recently bought the former Ritz-Carlton on Double Bay in Sydney for A$60 million and plans to spend another A$30 million to refurbish the hotel and its 144 rooms for a re-opening in the first quarter of next year. A Royal Group spokesman told TODAY the company expected “stabilised yields of over 14 per cent”. The hotel used to be owned by Singaporean billionaire Ow Chio Kiat’s St****** but was sold to fund management firm Scarborough. Although Scarborough had approval for a cinema complex and a residential block, it met with strong objections from the neighbourhood and abandoned the project.
Singapore’s Amara Group, headed by Mr Albert Teo, is currently negotiating with Perth’s city council to put up a 33-storey tower with a hotel of 251 rooms next to the Ambasador Hotel on Adelaide Terrace. Encouraged by the highest room and occupancy rates — nearly A$200 a night and 85 per cent, respectively — in the country, Perth has several other hotels in the pipeline. They include the 60-room Crown Towers in Burswood and the 224-room Holiday Inn Express.
Mainland Chinese and South Korean investors are also making their presence felt, with the five-star Four Seasons Hotel in Sydney reportedly sold to a South Korean consortium by Australia’s Eureka Fund Management. Meanwhile, Chinese backing is said to be behind the first Green Globe-certified tourist resort on the Great Barrier Reef.
MediaCorp Press Ltd
Document TDAYSG0020130530e95v00007
conRAD RAJ Editor-at-Large Conrad Maria Jayaraj
722 words
31 May 2013
TODAY (Singapore)
TDAYSG
English
© 2013. MediaCorp Press Ltd.
SINGAPORE — Singaporean and other Asian investors are piling into the Australian hospitality sector, accounting for as much as 80 per cent of the investment in the property segment there, as cooling measures and low returns back home drive them overseas for higher yields.
“Asia-based investors, including Singaporean, Malaysian and Hong Kong interests, will continue to dominate hotel acquisition activity this year, attracted by consistently strong and stable total returns relative to other regions in the Asia-Pacific,” said Mr Stephen Burt, the newly-appointed Sydney-based Managing Director of Hotels, Asia Pacific at property consultancy Colliers International.
Asian investors account for 70 to 80 per cent of the purchasers of Australian hotels in the past three years, and many of them are Singaporean, drawn by yields that typically range from “6 to upwards of 8 per cent”, Mr Burt told TODAY. Spurred by this strong interest, Colliers plans to set up a dedicated hotel unit here. “We already have a specialist in Hong Kong and are in the process of appointing a person here in Singapore,’’ he said.
He has assembled a team of about nine in Australia.
More than A$1.25 billion (S$1.52 billion) worth of hotels in Australia changed hands last year with Asian investors, up 30 per cent from 2011. The largest single transaction was the A$330-million sale of the Shangri-La Hotel in Sydney by the Government of Singapore Investment Corp to Malaysian tycoon Robert Kuok’s Shangri-La group.
A portfolio of three Marriott Hotels was sold by Australia’s Commonwealth Managed Investments for A$415 million to Malaysia’s Starhill Reit controlled by tycoon Francis Yeoh of the YTL group.
Mr Burt, as Chief Executive of Mirvac Hotel Group, was instrumental last year in transferring 49.2 per cent ownership of Mirvac Wholesale Hotel Fund (since rebranded as the Ascendas Australia Hospitality Fund), comprising seven hotels in Sydney, Brisbane, Cairns and Melbourne, to a group of investors led by Singapore’s Ascendas Group for A$327 million. Ascendas also bought the 300-room Esplanade Hotel in Fremantle for A$90 million.
Last July, Singapore’s Straits Trading Company acquired the Rendezvous Grand Hotel in Melbourne for A$61 million from Australia’s Challenger Life Nominees. Straits Trading Company also owns two other Rendezvous hotels in Australia.
The rising number of visitors to Australia has led to a surge in hotel construction. More than 6.1 million tourists visited Australia last year, including 340,000 from Singapore, pushing the average national hotel occupancy rate up one percentage point to 75.5 per cent. According to Colliers, the supply of new hotel rooms across Australia is expected to “rise markedly” over the next few years.
Singapore’s Royal Group, headed by Mr Ashok Hiranandani, recently bought the former Ritz-Carlton on Double Bay in Sydney for A$60 million and plans to spend another A$30 million to refurbish the hotel and its 144 rooms for a re-opening in the first quarter of next year. A Royal Group spokesman told TODAY the company expected “stabilised yields of over 14 per cent”. The hotel used to be owned by Singaporean billionaire Ow Chio Kiat’s St****** but was sold to fund management firm Scarborough. Although Scarborough had approval for a cinema complex and a residential block, it met with strong objections from the neighbourhood and abandoned the project.
Singapore’s Amara Group, headed by Mr Albert Teo, is currently negotiating with Perth’s city council to put up a 33-storey tower with a hotel of 251 rooms next to the Ambasador Hotel on Adelaide Terrace. Encouraged by the highest room and occupancy rates — nearly A$200 a night and 85 per cent, respectively — in the country, Perth has several other hotels in the pipeline. They include the 60-room Crown Towers in Burswood and the 224-room Holiday Inn Express.
Mainland Chinese and South Korean investors are also making their presence felt, with the five-star Four Seasons Hotel in Sydney reportedly sold to a South Korean consortium by Australia’s Eureka Fund Management. Meanwhile, Chinese backing is said to be behind the first Green Globe-certified tourist resort on the Great Barrier Reef.
MediaCorp Press Ltd
Document TDAYSG0020130530e95v00007