Korean investment group Mirae Asset Global Investments?has acquired the Four Seasons Hotel Sydney?for just over $300 million, reports the Canberra Times of Australia.
Eureka Funds Management put the former Regent Hotel up for sale earlier this year after giving it a more-than $40-million renovation.
The 531-room hotel commands a prime position overlooking Sydney Harbour.
The Four Season sale was jointly marketed by Jones Lang LaSalle’s Hotels & Hospitality Group and McVay Real Estate on behalf of Eureka Funds Management.
The hotel will be managed by Millinium Capital Managers.
Glen Boultwood, fund manager at Eureka, told the Canberra Times that the sale of the hotel was to “capitalize on its increase in value since the fund bought it in 2006 for $225 million. Eureka remains committed to the hotel sector and continues to own seven hotels across Australian and New Zealand.”
He added that bidding for the hotel was competitive, with interest from investors in China, Hong Kong, Singapore, Korea and the U.S.
According to its website, Mirae Asset Global Investments has?$54.3 billion assets under management?as of June 30, 2013.
HOT MARKET
Austraila, specifically Sydney, continues to be a hot market for hotel transactions. Last August, Hong Kong-based Shangri-La Asia?set a benchmark?with the acquisition of the 563-room Shangri-La Hotel Sydney for $352 million, besting prior record of $249 million shelled out for the neighboring Sydney Harbour Marriott Hotel at Circular Quay, a similar size property, one month earlier.
That same summer, Langham Hospitality Group secured its first hotel in Sydney with the acquisition of The Observatory Hotel, Sydney.
The result of all the action is?higher rates. As The Australian reported, many of the properties being bought in Sydney are being tagged for residential or commercial conversion. The result of which is less hotel supply.
“It is worrying to see that in a time when Sydney needs more hotel rooms we are still seeing the conversion of existing stock into residential,” said Rutger Smits, director of AHS Advisory Hospitality and Real Estate Consulting. “This market is crying out for more hotel rooms, (but) we are still seeing the potential conversion of existing hotels into residential.”
Not surprising Sydney is Australia’s hottest markrt for hotel investment, accounting for about 60 percent of the national transaction volume this year, the Canberra Times reports.
Other recent sales include the Hotel Ibis on King Street Wharf, Diamant Sydney and Mercure Sydney in Potts Point and the Ritz Carlton in Double Bay.