HVS Asia Pacific Hospitality Newsletter - Week Ending 6 December 2024

Pavilion REIT Enters Conditional Agreements for the Acquisition of Two Hotels in Bukit Bintang for MYR480 Million

Malaysia-based Pavilion REIT Management Sdn., Bhd. (“Pavilion REIT”) have entered separate conditional agreements to acquire the 55-key Banyan Tree Kuala Lumpur from Malaysia-based Lumayan Indah Sdn., Bhd. for MYR140 million; and the 325-key Pavilion Hotel from Harmoni Perkasa Sdn., Bhd. for MYR340 million. The Banyan Tree Kuala Lumpur features multiple food and beverage options including a rooftop bar, a spa, a fitness centre, a swimming pool, and meetings and events facilities. The Pavilion Hotel offers three food and beverage options, children’s area, club lounge, an infinity pool, a fitness centre, and meetings and events facilities. As part of the agreement, the hotels will be leased back to the current operator for an initial 10-year term with the option to renew for up to 20 additional years. The fixed rental income will commence at MYR33.5 million for the first five years and will be subject to incremental adjustments every five years. Upon completion of the acquisition, the two hotels will represent 5.5% of Pavilion REIT’s assets under management.

BAM Acquires Hotel X Brisbane Fortitude Valley, Vignette Collection

Canada-based Brookfield Asset Management Inc. (“BAM”) has announced its acquisition of the 146-key Hotel X Brisbane Fortitude Valley, Vignette Collection. While the acquisition price remains undisclosed, local sources report it to be approximately AUD 90 million. The property includes an on-site restaurant, a rooftop bar and swimming pool, 1,438 square metres of leased office space, a fitness centre, and meeting facilities. It is located in Fortitude Valley, a popular destination known for its vibrant retail scene and lifestyle offerings, in close proximity to Brisbane's central business district.

Prendiville Group Acquires Travelodge Resort Darwin for AUD23 Million

Australia-based Prendiville Group has acquired 224-key Travelodge Resort Darwin including 32 self-contained townhouses from Australia-based TFE Hotels for AUD23 million, which translates to approximately AUD137,000 per key. The freehold property sits on a 1.31-hectares site, features an array of amenities, including five swimming pools, one food and beverage outlet, conference and events facilities, a BBQ area and 115 parking spaces. Conveniently located 15-minutes away from Darwin Airport, the hotel is situated directly across from the new Charles Darwin University campus which will add further demand and create new revenue streams for the hotel.

Rackson Group Launches MYR1.5 Billion Integrated Development in Penang, Malaysia

Malaysia-based property developer, Rackson Group, has unveiled plans for a MYR1.5 billion integrated development in Bayan Lepas, Penang, comprising the Le Meridien Penang Airport hotel and Avion Serviced Apartments. Slated for completion by the last quarter of 2027, the Le Meridien Penang Airport Hotel will feature 200 guest rooms, complemented by facilities such as 300 person-capacity ballroom, a sky infinity pool and all-day dining outlets. Avion Serviced Apartments will offer 608 keys in one- to three-bedroom configurations, along with amenities including an infinity pool, a multipurpose hall and a sky lounge. Conveniently situated near Penang International Airport, the development will also benefit from proximity to the planned light rail transit airport station and the upcoming Mitsui Outlet Park, with construction expected to be completed by 2030 and 2027, respectively.

Saudia Launches Non-stop Flights Connecting Riyadh, Jeddah, and Phuket

Saudi Arabia’s flag carrier, Saudia, has launched non-stop flights from Riyadh and Jeddah to Phuket. The airline will operate the Riyadh-Phuket and Jeddah-Phuket routes using Boeing 787-9 aircraft. Each route will have three weekly flights until 28th February 2025. Additionally, Saudia currently operates four to five weekly flights from Jeddah to Bangkok, three from Riyadh to Bangkok, and three weekly flights between Riyadh and Bangkok via Jeddah. From January 2024 to 25th November 2024, Thailand welcomed 209,929 Saudi tourists, reflecting a 28% year-over-year increase. These new direct routes highlight the growing demand for travel between the two nations.