A sale turns to dust
Singapore-listedAscendas Hospitality Trustcalled off plans for asale and decided to retain its S$1.49 billion portfolio made up of 11 hotels acrosskey cities in Australia, China, Japan and Singapore.
In anannouncement that marks the end of a process that started late 2015, the trust saidits manager ceased all talks related to the potential acquisition after evaluatingoffers from potential buyers.
It waspreviously reported thatBlackstone Group LP, GawCapital Partners, Varde Partners and Westmont Hospitality Group were circling theREIT, while Starwood Capital Group and Fosun International Ltd. were also to be considering offers forthe company.
Whattriggered the deal collapse might be a mismatch on price expectations.
AscendasHospitality Trust said March 30 that its net asset value per stapled security asat Dec. 31, 2015, would be 84.2 Singapore cents, instead of the 70.3 cents announcedpreviously, based on updated valuations.
It askedthe three final bidders to increase their offers based on the updated property valuations,but eventually decided to scrap the sale after determining the new bids were stilltoo low, The Straits Times reported,citing people with knowledge of the matter.
* Ina bid to bring more accommodation on stream amid the rapid increase of inbound tourists,the Ministry of Land, Infrastructure, Transport and Tourism plans to relax hotelfloor area ratio rules to make it easier for developers to add new or additionalcapacity, The Yomiuri Shimbun reported.The maximum hotel floor area ratio is expected to exceed 1,300% for large developmentprojects in Tokyo and Osaka. The ministry will notify local governments of the detailedpolicy relaxation by this summer.
* Accordingto statistics from the Cabinet Office, hotel occupancy rates averaged 79.9% nationwidein 2015, up 7.4% from 12 year ago, Tokyo's TheNikkei reported.Occupancy rates in Osaka, Kyoto, Aichi and Tokyo were all above 83%, among the highestin Japan.
M&A news Down Under
* SouthAfrican-backed Growthpoint PropertiesAustralia approachedGPT Metro Office Fundwith an unsolicited offerto buy out the fund. It later withdrew the unsolicited proposal, but came back andresubmitted a roughly A$295million takeover bid for GPT Metro. The new offer implies a A$2.31 considerationper GPT Metro unit, up from A$2.30 apiece in the earlier offer.
* Meanwhile,DEXUS Property Group the support of proxy adviserOwnership Matters for its InvestaOffice Fund takeover bid. The proxy adviser initially disapproved ofthe transaction, but DEXUS' improvedoffer led it to change its recommendation. DEXUS also appears to have gained supportfrom the fund's major shareholders, as RREEF and CBRE Clarion are urging Australia'sTakeovers Panel to prevent Morgan Stanley from voting on the merger.
However,the improved takeover offer still undervalues the office trust, according to InvestaListed Funds Management Ltd., which has sent a letter to the fund's unit holdersthis week ahead of the vote on April 15, saying that the fund's portfolio shouldbe updated to reflect improved market conditions.
Big dreams, bigger buildings
* GreenlandGroup, a Chinese developer known for building skyscrapers, plans to develop thehighest building on South Korea's Jeju Island worth 700 billion South Korean won,along with Lotte Tour, the Korea JoongangDaily reported.The Dream Tower will have 38 floors on a 302,777-square-meter site and is slatedto be completed by March 2019. It will feature a total 1,626 hotel rooms, a casinofor foreigners and shopping malls. China State Construction Engineering Corp. willserve as the main builder of the project.
* AbuDhabi-based real estate firm Royal Group looks to acquire hotels in Asia-Pacificcities such as Bangkok, Hong Kong, Jakarta, Kuala Lumpur and Sydney, The (Singapore) Business Times reported.The company's hotel portfolio currently comprises six properties, including fourassets in Singapore, but it plans to target gateway cities worldwide to take advantageof growth in the global hospitality market.
* a A$350 million redevelopment projectfor the Mandurah Forum Shopping Centre in Western Australia, adding almost 26,200square meters of retail space to the existing 38,300 square meters. The projectis part of a A$3.1 billion development pipeline, of which Vicinity's share is A$1.5billion.
* BlackstoneGroup and Mirvac Groupare believed to be partneringto bid for the A$900 million portfolio that Vicinity Centres is to offload. The partners are saidto be entering due diligence for a potential transaction.
* Aspart of a bigger effort to build scale in theFrench real estate market, Singaporean sovereign wealth fund GIC agreed to a 25% stake in French REIT from New York-based NorthwoodInvestors LLC, which will value the REIT at aboutS$732.7 million.
* PingAn Insurance is reportedlyone of the parties being courted as a capital partner for Lendlease Corp. Ltd.'s proposed Circular Quay scheme in Sydney.The Chinese insurer this week also revealed it wanted to boost its offshore propertyholdings, the South China Morning Postreported.It holds about 2% of its assets offshore, below the 15% allowed by Chinese regulators.
* recordedpre-sales value of 12.40 billion Chinese yuan during the first quarter.
* 'scontracted sales for the first quarter was approximately 42.87 billion yuan.
* reportedthat its contracted sales for the first quarter reached roughly 16.4 billion yuan.
* posted 75.24billion yuan of contracted sales in the first quarter.
* said it recorded contracted sales worth around 65.67 billion yuan in the first quarter.
* loggedapproximately 11.06 billion yuan of contracted sales in the first quarter.
: Large Chinese acquirers, including several insurancecompanies, are seeking to invest in U.S. assets. But observers say Anbang InsuranceGroup's ultimately unsuccessful bid to acquire Starwood Hotels & Resorts Worldwideillustrates the difficulties of cross-border M&A.
: A joint venture between Hersha HospitalityTrust and Cindat Capital Management, originally forecast to close by March 31, isnow expected to be completed in the second quarter.
:The April 7 edition of the Asia-Pacific property news recap also features two buyerstipped to be in the running for The Zenith, a A$280 million Sydney asset co-ownedby DEXUS Property Group.
:Hotel Lotte's South Korean listing could be potentially delayed, while the Germanspinoff of Australia's GPT Group looks to revive its IPO or trade sale plan.
: S&P Global Market Intelligence presents aweekly rundown of recent significant management and board changes and personnelmoves in the European and Asia-Pacific real estate industries.