iProsperity buys 23 hotels in year’s largest deal
The slow year for hotel deals is finally picking up pace with fund manager iProsperity swooping on the AccorInvest portfolio for a price of less than $250 million in what will still be the largest transaction of 2019.
The group, which has been carving out a name as a fund manager locally and by sourcing funds in Asia, has acquired the properties, some of which were sold with vacant possession, giving the new owner a chance to boost their performance.
The deal breaks the drought of major hotel transactions this year and more are on the horizon with the Royal Group Holdings in due diligence to buy Sydney’s Sofitel Wentworth Hotel for more than $300 million.
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But a lot of the action may be for middle-market style hotels, which are forecast to outperform despite the rocky economic conditions.
In the last month, two Sydney properties have traded as sales pick up, partly as buyers see the lower dollar as prompting a lift in tourism.
Funds manager Tyche Capital Investments bought the Veriu Central Hotel in Sydney’s Wentworth Avenue in a near $60 million sale and leaseback deal.
The Yeh’s Group also bought the Seasons Harbour Plaza Sydney for about $70 million in one of the city’s first major strata hotel deals.
The latest iProsperity purchase is for a larger platform.
Buying the AccorInvest portfolio will give it control of a mix of 23 properties and leased interests in Sydney, Melbourne, Canberra, Brisbane and Perth, along with several major regional cities.
The Australian flagged iProsperity’s purchase last November and JLL Hotels & Hospitality Groups’ Craig Collins and Peter Harper are handling the sale but declined to comment, as did iProsperity.
The Pullman on the Park hotel in East Melbourne sold last year.
The firm last year bought the five-star Pullman on the Park near the Melbourne Cricket Ground from Canadian real estate giant Brookfield.
The AccorInvest portfolio spans 17 owned properties, comprising 1797 rooms. Four are branded ibis hotels, and the other 13 are ibis Budget hotels.
Notable assets include the ibis Hotel & Apartments Melbourne, ibis Sydney Airport, ibis Budget Sydney Olympic Park and ibis Newcastle.
The six lease interests include The COMO Mgallery by Sofitel in Melbourne, the Novotel, Mercure and ibis hotels in Brisbane and the Mercure and ibis hotels in Perth.
AccorInvest is the spun-off hotel investment platform of Paris-listed AccorHotels. A 57.8 per cent stake in the vehicle was sold to GIC, PIF, Credit Agricole Assurances, Colony NorthStar and Amundi, and other investors for €4.6bn last year.
AccorInvest’s hotel real estate portfolio stood at about 891 hotels with most in Europe.
IProsperity controls other hotels in prime locations in major cities under the InterContinental, Crowne Plaza and Park Regis brands. It has longer-term plans to control $10bn worth of local property.
This article originally appeared on www.theaustralian.com.au/property.
