Mirae said to be lead bidder for Anbang’s US luxury hotel portfolio

The portfolio includes the Westin St. Francis (pictured here) in San Francisco, the Loews Santa Monica Beach Hotel and the JW Marriott Essex House in New York. Photo: Westin St Francis website

South Korea’s Mirae Asset Financial Group is emerging as the leading bidder for a portfolio of 15 U.S. luxury hotels being sold by troubled Chinese insurer Anbang Insurance Group Co., people with knowledge of the matter said.

An affiliate of Mirae is working to arrange financing and reach an agreement on terms of a purchase, according to the people, who asked not to be identified because the information is private. An acquisition by the South Korean asset manager could value the 15 properties at more than $5.5 billion, one of the people said.

Anbang hasn’t granted exclusivity to Mirae, and at least one other suitor is still actively pursuing the assets, the people said. If talks are successful, Mirae aims to make a nonrefundable deposit by the end of the month, according to one person.

Anbang bought the properties’ owner, Strategic Hotels & Resorts Inc., from Blackstone Group Inc. for about $5.5 billion in 2016. The deal was part of a global buying spree that made Anbang synonymous with China’s unbridled appetite for international trophy assets. That era ended when Chinese authorities seized control of Anbang and later sentenced Chairman Wu Xiaohui to 18 years in prison.

The hotel portfolio also attracted interest from suitors including Brookfield Asset Management Inc. and a consortium fronted by a former lieutenant to the U.K.’s billionaire Barclay twins, Bloomberg News has reported. The properties include the Westin St. Francis in San Francisco, the Loews Santa Monica Beach Hotel, the JW Marriott Essex House in New York and the Four Seasons in Jackson Hole, Wyoming. Separately, Anbang still owns the famed Waldorf Astoria hotel in Manhattan from a $1.95 billion deal in 2015.

No final agreements have been reached, and another buyer could still emerge, the people said. A representative for Mirae declined to comment. The China Banking and Insurance Regulatory Commission, Anbang’s ultimate custodian, didn’t immediately respond to a request for comment.

Mirae has previously invested in U.S. hotels, buying the five-star Fairmont San Francisco Hotel in 2015 and the Fairmont Orchid hotel on the big island of Hawaii in 2016.

The U.K. and Germany were the top two destinations for South Korean real estate investment last year, followed by the U.S., according to CBRE. Korean interest in London office property has dropped this year on concerns over Britain’s withdrawal from the European Union, according to broker Knight Frank.

Bloomberg