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Subject to the fulfilment of certain conditions, Ascendas Hospitality Business Trust has agreed to buy a hotel in Osaka, Japan from Ainodake Godo Kaisha for ¥8.9 billion (S$110.8 million).
The hotel, known as the Osaka Namba Washington Hotel Plaza (pictured), has a purchase price of 3.3 percent below the independent property valuation of ¥9.2 billion by Savills Japan.
Opened in 1997, the hotel offers 698 guest rooms and two restaurants spread across 14 floors and two basement levels. It was one of Washington Hotel K.K.’s flagship properties. The hotel operator will continue to lease the said property until the end of December 2015 for ¥652.6 million (S$8.11 million) per year.
“We are excited to announce that contracts have exchanged for this key sale in Osaka. The second largest hospitality market in Japan,” commented Atsushi Murai, Senior VP for Asian Investment Sales at JLL’s Hotels & Hospitality Group, which brokered the deal.
Moreover, the acquisition is expected boost the cashflow of A-HTRUST. The firm will have the flexibility to re-negotiate the leasing agreement when it expires in 2015.
“Osaka Namba Washington Hotel Plaza is a hotel in an excellent location within the vibrant city of Osaka which positions us to benefit from its growing hospitality market – for both leisure as well as business travel,” said Tan Juay Hiang, CEO of Ascendas Hospitality Fund Management and Ascendas Hospitality Trust Management, the managers of the trust.
“This acquisition deepens our presence in Japan and is expected to be DPS accretive. It also adds stability to A-HTRUST’s income streams and provides upside potential from asset enhancements, bringing value to our stapled securityholders,” he added.
Image Source: JLL
Nikki De Guzman, Junior Journalist at PropertyGuru, wrote this story. To contact her about this and other stories, email nikki@propertyguru.com.sg.
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