Anbang Down to the Last Six Buyers for Strategic Hotels

Main Photo: The Ritz-Carlton Hotel, Half Moon Bay

Date: June 2019

Location: Across the USA from Half Moon Bay, California to Essex House, New York

Name: 15 five-star hotels under various brands

No. of Keys: Around 7,000

Seller: China’s Anbang Insurance Group, under some pressure from the Chinese government.

Buyer: As at last month, everyone and his uncle…looks like it has been whittled down to the last six…The field of investor groups bidding for the luxury hotel portfolio owned by the Chinese insurer has narrowed to about a half dozen, with bids ranging from about $5.5 billion to $5.8 billion, according to the folks at Wall Street Journal.

Blackstone Group LP, Brookfield Asset Management and Mirae Asset Management, part of a South Korean financial-services company, are among the current bidders. The number of bidders is down from nearly 20 groups that expressed interest in the portfolio.

Begs the question are Singapore’s GIC and Softbank still in the running?

Anbang Insurance Group Co. has been “asked” to unload the luxury hotel collection that it acquired for $5.5 billion about three years ago from Blackstone, as pressure builds on the company to raise cash following its seizure by the Chinese government.

A representative for Anbang declined to comment.

The portfolio includes 15 high-end properties, among them Essex House Hotel overlooking Manhattan’s Central Park, the Four Seasons Hotel in Jackson Hole, Wyo., and the Fairmont in Chicago.

Anbang was at the centre of a wave of Chinese insurers and other investors who went on a U.S. real-estate buying spree, taking advantage of new rules that allowed them to invest more easily abroad. Chinese companies, like HNA Group Co. and Greenland Holding Group, scooped up trophy assets in big U.S. cities.

In 2015, Anbang paid $1.95 billion for New York’s landmark Waldorf Astoria hotel—the highest price ever for a U.S. hotel. The property, which isn’t part of the Strategic portfolio Anbang bought from Blackstone, currently is closed as it undergoes a massive renovation.

Likely Price: US$5.8bn

Price per Key: Around US$828,571

THPT Comment: What government pressure does to the price…so little movement on the US$5.5bn they shelled out three years ago, although we believe they sold one hotel off.

First Seen: Wall Street Journal

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