SYDNEY • Real estate investment group M&L Hospitality wants to expand its portfolio Down Under, joining the rush to bring new hotels to Australia's most populous city.
Singapore's Kum family-owned group plans a deal for a former electricity substation that can accommodate a major hotel development, The Australian reported on Monday.
The deal, worth A$22 million (S$21.7 million), is to be done with Alfasi Property Development which owns the 1,180 sq m site with the decommissioned electricity hub, the newspaper reported.
If finalised, the deal will add to M&L Hospitality's packed development pipeline in Sydney, which includes the nearly completed upgrade of Swissotel.
It also has an undertaking worth US$220 million (S$313 million) to redevelop the Four Points by Sheraton hotel and an adjoining conference centre in the city.
M&L's chief executive, Mr Neil Maxwell, has declined to comment on the deal.
Alfasi, which is in the course of securing development approval for the site, had planned to build service apartments at the site, but M&L Hospitality is likely to consider other plays, since it is largely a hotel investor, property executives told The Australian.
M&L, which has been flexing its development muscle, was considering a Sydney listing in late 2013 after putting an initial public offering in Singapore on hold in 2012.
The group has since refurbished a Hilton hotel in Melbourne and is now undertaking works on the Hilton Auckland in New Zealand.
M&L has also picked up a major development site in Melbourne, proposing a 73-level mixed-use tower that includes 482 residential apartments and a 390-bed hotel.
M&L owns mainly economy to mid-range hotels in Australia, New Zealand, London and Japan.
Chairman Michael Kum had been quoted earlier as saying that the family goes for assets in "key gateway cities... in short, where Singapore Airlines will land".
Sydney has become a focus for boutique projects with hotel aspects, with many major projects under way.
Lend Lease backed by tycoon Jerry Schwartz, along with China's Greenland Group and Dalian Wanda Group all have projects lined up in the Australian city and other developers are planning a series of boutique projects as the city's hotels perform strongly.
Taiwanese hotel operator Yeh's Family Holdings has also submitted plans to convert a nine-storey office block into a luxury hotel after it picked up the building for A$21.25m earlier this year, The Australian reported.