AccorHotels Restructures Down Under
After successfully reaching an agreement with one of Abu Dhabi Investment Authority's wholly-owned subsidiaries, AccorHotels has announced that it is planning to restructure a portfolio of 31 hotels in Australia.
This portfolio, the company recently announced, includes 4,097 total rooms, and it was first purchased by one of Abu Dhabi Investment Authority's subsidiaries in 2013. The hotels involved are all operated by AccorHotels. So, what then, does this mean for the everyday business of the hotels involved?
First and foremost, AccorHotels is slated to convert 15 triple-net leases into 50-year management agreements, also extending the management term of another of the portfolio properties to 50 years. This means that 16 total hotels in Australia will remain managed by AccorHotels for the better part of the centry. Second, AccorHotels will acquire the real estate of the remaining portfolio properties, with the estimated cost being $200 million (AUD) or €137 million.
In a press release announcing the deal, John Ozinga, COO of HotelInvest, said, "This deal is in line with our stated strategy to optimize cash flow generation, reduce earnings volatility and restructure lease contracts into owned and managed hotels. The acquisition of the economy hotels in key locations is a signal of our continued focus on supporting the Group's growth strategy by holding a selective portfolio of profitable hotel property assets."
The company went on to emphasize that all of the hotels involved in this deal are located in prime places, including Sydney Olympic Park, Sydney's Darling Harbor, and Canberra, which is the capital of Australia. The properties that are involved in this portfolio also stretch across other locations such as New South Wales, Victoria, Northern Territory, Western Australia, and Queensland. The involved brands include Pullman, Novotel, Mercure, Ibis, Ibis Styles, and Ibis Budget.
The company said it expects that these deals and acquisitions will help to bolster its position as a market leader in Australia by adding so many key assets. Of course, full completion of these acquisitions still remains subject to the standard conditions for such a transaction, as well as regulatory approval.
AccorHotels is currently positioned as a world-leading travel and lifestyle group, with more than 4,000 hotels, resorts and residences, as well as 2,500 private homes in locales throughout the globe. AccorHotels is currently operating in 95 total countries. The company's portfolio is made up primarily of luxury brands, with the names including Raffles, Fairmont, Sofitel Legend, SO Sofitel, Sofitel, Onefinestay, MGallery by Sofitel, Pullman and Swissôtel; as well as the popular midscale and boutique brands of Novotel, Mercure, Mama Shelter and Adagio; the in-demand economy brands including Ibis, Ibis Styles, Ibis Budget and the regional brands Grand Mercure, The Sebel and hotelF1.
AccorHotels also possess a history that spans back nearly five decades, plus a global team of more than 240,000 employees. Accor SA is publicly listed with shares trading on the Euronext Paris exchange (ISIN code: FR0000120404) and the OTC marketplace (Code: ACRFY) in the United States.
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Lennart Kooy
associate partner TOPHOTELMEDIA
TOPHOTELPROJECTS
