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Accor-Mantra deal elicits watchdog review; Cromwell to cut €1.83B REIT portfolio


According to Market Intelligence, December 2022


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Accor-Mantra deal elicits watchdog review; Cromwell to cut €1.83B REIT portfolio

* AccorHotels' proposed A$1.18 billion takeover deal for Australian hotel operator Mantra Group Ltd. is set to be monitored and reviewed by the Australian Competition and Consumer Commission, or ACCC.

Reuters reported that the review will commence "in due course once certain information" is provided by the involved parties. The approval of the ACCC and Australia's Foreign Investment Review Board is necessary in order for the deal to push through.

* Cromwell Property Group is cutting a number of Polish assets from the €1.83 billion portfolio intended for its Cromwell European Real Estate Investment Trust, which is gearing up for a Singapore listing. According to The Australian, the listed group decided on the asset reduction following requests from prospective investors to scale back the proposed European REIT's size in a bid to improve its yield potential.

* InterContinental Hotels Group Plc is planning to launch several new brands and properties over the next five years in various Asian locations, including China, Indonesia and Vietnam.


* Goodman Group CFO Nick Vrondas was quoted by Bloomberg News as saying that the listed industrial REIT is open to future investments in China's US$10 trillion debt market, admitting that China could become "another viable funding source" for the company.

* Vicinity Centres' wholesale funds arm is selling a Woolworths-anchored retail asset in the New South Wales city of Bathurst to QIC Global Real Estate for approximately A$70 million, The Australian reported. The buyer's due diligence is ongoing on the property, which was purchased by Vicinity for roughly A$62 million in 2014.

* Specialized real estate investment and advisory group Ashe Morgan is conducting due diligence on a A$200 million Sydney tower co-owned by superannuation funds Future Fund and Funds SA, with state-owned investment manager Victoria Funds Management Corp., The Australian Financial Review reported. It is understood that the deal for the 15,500-square-meter tower at 9 Hunter St. represents a yield in the low 5% range, the publication noted.

* The 12-level, 3,172-square-meter building at 16 Spring St., adjacent to a Lendlease Corp. Ltd.-owned site in Sydney, was taken to the market. The property could fetch a price of A$50 million or more, the AFR reported.

* Office rents in Melbourne and Sydney increased by almost 20% over the past two years, according to a report by the AFR, citing an Investa analysis. The rental price hike led to a sharp decline in office affordability in the two Australian cities, with net face rents increasing by about 13% yearly in Sydney and 15% in Melbourne.

Hong Kong and China

* Chinese President Xi Jinping, during his three-hour speech at the opening of the weeklong 19th National Congress of the Communist Party, emphasized that "houses are for living, not for speculating," Xinhua News Agency reported.

Meanwhile, Metroradio cited Paul Guan, partner in the real estate department of international law firm Paul Hastings LLP, as saying that Chinese developers will continue to bid for lands in Hong Kong with soaring land prices in first-tier cities in the mainland, and tightening policies on property markets will continue to be enforced.


* Mahindra Lifespace Developers Ltd., under a 51/49 joint venture with HDFC Capital Advisors Ltd., is planning to develop affordable housing projects across various sites in India. The pair agreed to invest 5.00 billion Indian rupees over the next three years for the plan.


* ESR-REIT entered into an option agreement with Hyflux Membrane Manufacturing (S) Pte. Ltd. for the proposed S$95.0 million acquisition of the roughly 72,569-square-meter 8 Tuas South Lane industrial asset, which comprises five factories, an eight-floor warehouse and four blocks of dormitories.

The real estate investment trust intends to finance the purchase using a combination of debt financing and financial support from its manager, ESR Funds Management (S) Ltd.


* Asahi Kasei Realty & Residence Corp. started the construction of a mixed-use apartment complex in the city of Kusatsu in Shiga Prefecture, Jutaku-Shimpo-Sha reported. The project, which includes shopping and living care facilities, will be centered around a 26-story building.

* Tokyu Corp. expects its ¥200 billion redevelopment project underway in Tokyo's Shibuya to generate EBITDA to the tune of ¥10 billion annually, Tokyo's The Nikkei reported. Mixed-used building Shibuya Cast opened in April, and a 35-story high-rise will open in 2018.

* Panasonic Corp.'s annual rent rate in MCUBS MidCity Investment Corp.'s Twin 21 OBP Panasonic Tower will be increased to roughly ¥1.92 billion from approximately ¥1.79 billion, effective July 1, 2018.

Other real estate news

* Chinese data center company GDS Holdings Ltd. and Texas-based REIT CyrusOne Inc. are teaming up to market and sell data center space and related services in the U.S. and China.

As part of the deal, CyrusOne will buy up to US$100 million of newly issued unregistered GDS ordinary shares, which is equivalent to 8.0 million American depository shares, at a per-ordinary-share price of $12.45 per depositary share.

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The Daily Dose Asia-Pacific, Real Estate edition is updated by 6:30 a.m. Hong Kong time. Some external links may require a subscription. Articles and links are correct as of publication time.

Rollen Catorce, Emily Lai and Jaekwon Lim contributed to this report.

As of Oct. 18, US$1 was equivalent to 65.07 Indian rupees, ¥112.98 and S$1.36.