Real estate tycoon Asok Kumar Hiranandani of the Royal Group has bought DoubleTree Hotel, the second parcel of The Intermark to be sold in April 2015.
The Singapore-based Royal Group Holdings, a property group which leans more towards the hospitality sector, bought the 540-room, four-star hotel for RM388 million, or about RM700,000 per room, a source from Royal Group Holdings said.
A hotel employee said the hotel generally had an occupancy rate of 75%.
According to the Royal Group website, the company was established in 1947 and its main business is in the development and management of real estate. Its portfolio includes a wide range of residential, industrial and commercial properties that include offices, malls and hotels with assets scattered in different parts of the world.
The source said the company was currently “going through the legal documentation of the purchase”.
Asok, chairman of the Royal Group, was ranked 20th among Singapore’s top-50 richest, with a net worth of US$1.4 billion, by Forbes last year.
The Intermark comprises four parcels, office blocks Integra Tower and the Vista Tower, DoubleTree Hotel and the Intermark Mall. All four parcels were put up for sale about a year or more ago, but it was only last week that the 39-storey Integra office block was sold to Retirement Fund Inc, also known as Kumpulan Wang Persaraan, for RM1.065 billion, with an annual yield of 6%.
The mixed integrated development is located at the Jalan Ampang-Jalan Tun Razak intersection in the city.
Negotiations are ongoing with local and foreign parties for the other two parcels, Vista Tower and the Intermark Mall, sources said. Vista Tower was formerly known as the Empire Tower. It went through massive refurbishment and today is a spanking new 62-storey, grade A office block with about 555,000 square feet of space. The Intermark Mall has about 200,000 sq ft.
According to industry sources, when the mall was first put on sale, the entire four components were priced at more than RM2bil. Due to its “hefty” price tag, the asset which sits on two hectares, was broken up and put on sale as four separate components.
Sources said the other two components will be sold this year.
“There are interested parties, both local and foreign,” an industry source said. As to why BlackRock Inc is divesting, a source said the fund’s life was coming to an end and BlackRock has to divest.
BlackRock came about this highly priced property when it bought Macquarie Global Property Advisors (MGPA) in 2013, an Australian-based private equity real estate fund advisory company, in order to expand its real estate business in the Asia-Pacific region and Europe. When BlackRock bought MGPA, the deal doubled BlackRock’s real estate assets to US$25bil, and gave the company its first exposure to Asian property.
The Intermark was wholly owned and developed by MGPA Asia Developments, a subsidiary of MGPA. MGPA Asia Fund II bought the Intermark assets in 2007, comprising a portfolio of assets - Empire Tower, City Square, Crown Princess and subsequently, Plaza Ampang.