HVS Asia Pacific Hospitality Newsletter - Week Ending 10 March 2017 (March 10, 2017)

Ascott REIT Launches US$313 Million Rights Issue to Fund Germany and Singapore Expansion

Ascott Residence Trust (Ascott REIT) issued a fully underwritten renounceable rights issue on 7 March to raise S$442.7 million (US$313.59 million). Current Ascott REIT unit holders will have the option of purchasing up to 481.7 million rights units at a ratio of 29 rights units for every 100 units they own. Proceeds will be used to partly fund the acquisition of its first property in Frankfurt (Citadines City Centre Frankfurt) and its second in Hamburg (Citadines Michel Hamburg) from The Ascott Limited for €65.4 million (US$69.2 million). Additionally, S$381.6 million from the equity fund raising will be used to pay for the acquisition of Ascott Orchard Singapore, which is expected to be completed by Q3-2017. Ascott REIT expects yields of up to 4.5 per cent for this acquisition and 5.4 per cent for the German properties. Once the acquisitions are completed, Ascott REIT will comprise more than 90 properties across 14 countries, expanding its asset size to S$5.3 billion and strengthening its position as the largest hospitality REIT in Singapore. Market capitalization will also grow to S$2.4 billion, increasing trading liquidity.

Pan Pacific’s Parent Company, UOL Group, Acquires Hilton Melbourne South Wharf

Singapore’s UOL Group recently announced that its wholly-owned Australian subsidiary, Success Venture Pty Limited (SVPL), has reached an agreement with Host Hotels & Resorts Conventions Pty Limited to acquire the 396-room Hilton Melbourne South Wharf for A$230 million (US$173 million). The purchase will be financed by bank loans and internal resources, and is part of UOL Group’s plan to expand its hotel portfolio and management businesses in the Oceania region. While the purchase is subject to usual post-completion adjustments, an initial deposit of A$17.25 million (or 7.5 per cent of the purchase price) was upon execution of the agreement. Following the completion of purchase, scheduled on or around May 31, Hilton Melbourne South Wharf will be rebranded as a Pan Pacific hotel. UOL said that the acquisition would allow for enhancement in operating efficiencies of their Australian hotels through economies of scale and greater awareness of the Pan Pacific and PARKROYAL brands. The 30,688-square-meter property is on a 99-year leasehold until 2108.

JW Marriott Phu Quoc, Emerald Bay Opens in Vietnam

Marriott International announced the opening of the JW Marriott Phu Quoc, Emerald Bay. Located on Vietnam’s largest island – Phu Quoc, the beachfront luxury resort offers 224 guestrooms, suites and villas, along with five restaurants and bars. The resort features a private beach, three outdoor pools, a signature JW Spa, and a host of leisure activities ranging from Vietnamese martial arts and lantern making, to cooking classes and wellness activities such as boot camp, yoga and island excursions. The hotel also boasts over 1,100 square meters of indoor and outdoor meeting space, including a 715-square-meter Grand Ballroom. JW Marriott Phu Quoc, Emerald Bay is the second hotel for the brand in Vietnam, and joins a portfolio of more than 80 JW Marriott hotels across 25 countries.

citizenM to Debut in Malaysia, in 2018

citizenM will make its debut in Malaysia with its first property in Kuala Lumpur, through a partnership with Hong Kong based Artyzen Hospitality Group. Slated to open in the second quarter of 2018, this will be the third citizenM to open in Asia, behind the citizenM Taipei Ximending, launching in the second quarter of this year, and the citizenM Shanghai Hongqiao, due to open in the first quarter of 2018. Owned by Cornerstone Partners Group, the 198-key property will be located in the city’s fashionable hub, Bukit Bintang. While specific features and facilities in the hotel have yet to be announced, hallmarks among the design and customization-focused hotel brand include technology that enables guests to customize lighting and temperature in their rooms and control the TV, along with 24-hour CanteenM eateries. The Dutch citizenM brand, which was founded in 2008, currently has properties in Amsterdam, Rotterdam, London, Glasgow, Paris and New York.

HICSA 2017 | Bringing Together Regional Owner Powerhouses

Hosted by HVS, the 13th edition of Hotel Investment Conference – South Asia (HICSA) will have special emphasis on hotel owners. The event will open with an exclusive pre-conference ‘Owners’ Only Roundtable’ in an effort to provide owners a platform where they can jointly and candidly express their views and concerns. The roundtable will feature a number of focused discussion topics which are of special relevance to this forum. The conference will also see multiple owner-driven panel discussions led by the some of the most prominent hotel owners in the South Asian region. Each year, HICSA successfully brings together representatives of more than 100 ownership groups, and the 2017 conference is already well placed to exceed last year’s numbers.

Absolute Share Price Performance, as on 10 March 2017

Closing Share Price as at 10 Mar 2017 03 Mar 2017 % Change
Australia Stock Exchange (ASX)
Event Hospitality and Entertainment Ltd 12.25 12.15 0.8%
General Property Group 4.84 4.92 -1.6%
Mirvac Group 2.15 2.14 0.5%
Mantra Group 2.67 2.78 -4.0%
Bangkok Stock Exchange (THB)
Central Plaza Hotel Public Co Ltd 35 35.5 -1.4%
Dusit Thani Public Co Ltd 9.4 10.2 -7.8%
The Erawan Group Public Co Ltd 4.48 4.62 -3%
Grande Asset Hotels and Property Public Co Ltd 0.89 0.93 -4.3%
Laguna Resorts & Hotel Public Co Ltd 26.5 27.75 -4.5%
Minor International Public Co Ltd 34.5 34.75 -0.7%
China Shanghai Stock Exchange (RMB)
Jinling Hotel Corporation Ltd 15.43 15.6 -1.1%
China Shenzhen Stock Exchange (RMB)
Huatian Hotel Group Co Ltd 7.28 7.44 -2.2%
Guangzhou Dong Fang Hotel Co Ltd 15.09 15.3 -1.4%
China Lodging Group Ltd 58.22 60.23 -3.3%
Home Inns & Hotels Management Inc 35.71 35.71 0.0%
Hong Kong Stock Exchange (HK$)
Miramar Hotel & Investment Co Ltd 15.98 15.9 0.5%
Regal Hotels International Holdings Ltd 4.23 4.24 -0.2%
Sino Hotels Holdings Ltd 2.82 2.78 1.4%
The Hong Kong & Shanghai Hotels Ltd 8.58 8.78 -2.3%
Shangri-La Asia Limited 9.48 9.94 -4.6%
National Stock Exchange (INR)
IHCL (Taj Hotels, Resorts & Palaces) 123.7 125.8 -1.7%
EIH (Oberoi Hotels & Resorts) 105.95 106.85 -0.8%
Hotel Leela Ventures 16.4 16.8 -2.4%
Korea Exchange (KRW)
The Shilla 45200 46000 -1.7%
Singapore Stock Exchange (S$)
Amara Holdings Ltd 0.49 0.485 1.0%
Ascendas Hospitality Trust 0.75 0.755 -0.7%
Ascott Residence Trust 1.085 1.175 -7.7%
Banyan Tree Holdings Limited 0.48 0.49 -2%
CDL Hospitality Trusts 1.385 1.41 -1.8%
Far East Hospitality Trust 0.585 0.59 -0.8%
Frasers Hospitality Trust 0.68 0.69 -1.4%
Hotel Grand Central Ltd 1.4 1.42 -1.4%
Hotel Properties Ltd 3.96 3.85 2.9%
Mandarin Oriental International Ltd (US$) 1.275 1.275 0%
OUE Hospitality Trust 0.675 0.7 -3.6%
Stamford Land Corporation Ltd 0.525 0.52 1%
Taiwan Stock Exchange (NT$)
Formosa International Hotels Corporation 168 172.5 -2.6%
The Ambassador Hotel, Ltd 23.65 23.85 -0.8%
Tokyo Stock Exchange (JPY)
Japan Hotel REIT Investment Corp. 77500 79400 -2.4%
Imperial Hotel, Ltd 2105 2110 -0.2%
Red Planet Japan Inc 31 32 -3.1%

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