SINGAPORE - Park Hotel Group, which announced a $300 million or $893,000 per room sale of its Park Hotel Clarke Quay to Ascendas Hospitality Trust over the weekend, is understood to have put some of its other hotels on the market as well.
Industry players say these include its two remaining Singapore hotels - Grand Park City Hall in Coleman Street and Grand Park Orchard (along with its retail podium Knightsbridge).
The group is said to be seeking more than $1 billion for the latter asset or a whopping sum in the high-$1 million range per room - which if achieved would reprice the Singapore hotel market, according to industry players.
The asset comprises the 308-room Grand Park Orchard and about 74,000 sq ft net lettable area of retail space - leased to retailers such as Abercrombie & Fitch, Topshop/Topman, Brooks Brothers, Tommy Hilfiger, Dickson Watch & Jewellery, and The Hour Glass.
Assuming the hotel rooms are priced at $2 million per room or totalling $616 million, the retail space would be valued at about $5,200 per square foot (psf) - based on a $1 billion price tag for the overall asset. Sources suggest Park Hotel Group could be thinking of pricing the retail space higher, at more than $6,000 psf, which would still reflect a record pricing in the high-$1 million range per hotel room.
However, Grand Park Orchard (with Knightsbridge) may not be the next asset the group may sell, suggests a hotel broker. Instead the Coleman Street hotel is more likely to be divested first. Word on the street is that a price of around $1 million per room is being sought for this property, which is on a site with a remaining lease of about 79 years.
"Why sell the jewel (Grand Park Orchard) first? Having achieved nearly $900,000 per room for the Clarke Quay transaction and if they can get $1 million per room or close to it for the Coleman Street hotel - both of which are leasehold properties - that would serve as another benchmark that will help push up the value of its freehold Orchard Road hotel," said the hotel broker.