UOL to sell Parkroyal Kitchener Hotel for $525 million
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The sale and purchase agreement will see the disposal of five million ordinary shares of hotelier Parkroyal Kitchener Hotel.
PHOTO: PARKROYAL ON KITCHENER ROAD, SINGAPOREFACEBOOK
Daphne Yow
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SINGAPORE – Property group UOL has agreed with an entity of Worldwide Hotels, the owner of Hotel 81 in Singapore, to sell Parkroyal on Kitchener Road for $525 million.
The sale and purchase agreement between Pan Pacific Hotels Group (PPHG), a wholly-owned subsidiary of UOL, and Midtown Properties will see the disposal of five million ordinary shares of Parkroyal Kitchener Hotel (PKH), representing its entire issued and paid-up share capital. The disposal will be completed on Oct 31.
PKH’s property comprises Parkroyal on Kitchener Road, a 542-room hotel in Little India, and New Park Shopping Arcade.
The consideration takes into account the property’s latest available valuation of $423 million as at Dec 31, 2022.
UOL said that the disposal will enable it to “unlock the value of its investment in PKH at an attractive price”, and is “part of the group’s reconstitution of its overall property portfolio”.
It will use the net proceeds for its general working capital requirements and to repay its bank loans.
In a flash note, Citi’s investment research arm noted that UOL will record a divestment gain of $446.2 million from the sale.
Real estate services company JLL, which advised PPHG on the sale, said this is the biggest single-asset hotel transaction in Singapore and the second-biggest in Asia-Pacific in 2023.
UOL shares closed up 1.25 per cent at $6.47 on Wednesday.
