UAE sovereign fund ADIA looking to raise $500m from sale of two Sydney hotels

Sydney, Australia. Photo by Liam Pozz on Unsplash

Abu Dhabi Investment Authority (ADIA) is selling two of its Sydney hotel properties which could fetch the sovereign wealth fund (SWF) about $500 million, two sources familiar with the matter said.

The two hotels, Novotel Sydney on Darling Harbour and IBIS Sydney Darling Harbour, together have about 780 rooms and are the last hotels to be divested from a 31-asset portfolio that ADIA acquired in 2013, they said.

In 2016, ADIA sold 15 hotels in Australia to French hotel owner and operator AccorHotels for A$200 million ($147 million).

These assets were among the 31 properties ADIA acquired from Sydney-based Tourism Asset Holdings in 2013. The portfolio had made ADIA the largest hotel owner in Australia.

ADIA declined to comment.

ADIA has been investing in real estate since its creation in 1976. Real estate accounts for 5% to 10% of its portfolio.

Hotel occupancy has been hammered in Australia’s biggest cities as the country shut its international border when the COVID-19 pandemic hit and as travel between Australian states has been restricted. The impact has been partly offset as hotels are used for quarantining returning Australian travellers.

Hotel occupancy dropped to a low of 45% in 2020, while more than 5,000 new hotel rooms were added last year, according to a Deloitte Access Economics report.

ADIA said in its annual review last week that accelerated moves to more remote working, online shopping and less international travel represented permanent changes to the real estate industry but said it was hard to determine the scale of the impact.

“The real estate sector will need to adjust accordingly, particularly through developing more flexible, multi-use spaces and by meeting rising tenant expectations around amenities and health and safety,” it said.

ADIA, which Sovereign Wealth Fund Institute ranks as the fourth-biggest SWF in the world with $650 billion in assets, is headquartered in the capital of the United Arab Emirates and manages the surpluses of Abu Dhabi’s earnings from oil exports.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.