Commonwealth Property Hotel Fund acquires Sydney Renaissance Hotel
10 April 2001
Commonwealth Property Hotel Fund (CPHF) has acquired the Renaissance Sydney Hotel for $140 million from Kyo-ya Oceanic Company Limited.
CPHF is a sector specific, unlisted, opportunistic property fund established by Commonwealth Property to capitalise on value corrections in the hotel sector.
The Fund, which has a limited life of eight years and aims to invest in major hotel markets over the next 18-24 months, was established in June 2000 with the acquisition of the Brisbane Marriott Hotel.
In February 2001, CPHF acquired the Rockmans Regency Hotel, Melbourne.
Acquisition of the Renaissance Sydney Hotel gives CPHF exposure to the biggest hotel market in Australia.
Total assets will exceed $225.0 million following the acquisition which will give CPHF in excess of 1,000 rooms on the eastern seaboard of Australia.
According to Mr Selliah Kalyanakumar, CPHF's Fund Manager, "The Renaissance Sydney Hotel would become the corner stone asset of the Fund".
"Timing of the acquisition is very much in line with our opportunistic strategy and we are delighted to have an asset like the Renaissance. The hotel's location and physical characteristics will ensure that it remains a premier hotel in Sydney.
"We are presently considering various value add strategies with a view to enhancing the presence of the hotel," Mr Kalyanakumar said.
Marriott International (NYSE:MAR) has been retained as manager of the hotel.
Commenting on the sale, Mr Stanley Takahashi, Executive Vice President of Kyo-ya Oceanic Company Limited, was pleased that the sale had been finalised to such a reputable group as the Commonwealth Property Hotel Fund.
"The hotel, has been a valuable part of our company's portfolio for over 11 years, and we offer our best wishes to CPHF for every future success with the acquisition of the property," Mr Takahashi said.
The listing of the property was accomplished through Mr Geordie Clark and Mr David Gibson of Jones Lang LaSalle Hotels.
Mr Clark, Executive Vice President of Jones Lang LaSalle Hotels, said he believed the sale represented a further vote of confidence for the Sydney hotel market post-Olympics and CPHF had beaten an impressive list of global hotel investors to secure the hotel.
CPHF is managed by Commonwealth Property, the property funds management and corporate real estate arm of Commonwealth Bank Group.