Deal for Sentosa Resort & Spa being stitched

PHOTO: Deal for Sentosa Resort & Spa being stitched

SINGAPORE - Sentosa Resort & Spa (formerly known as The Beaufort Singapore) is close to being sold, BT understands.

The pricing for the 215-room property is likely to be around $1 million per room, which would take the transaction price past $200 million.

The Sentosa, which has a gross floor area of about 312,000 sq ft, is on a site with a remaining lease of about 60 years.

This is believed to be the first resort hotel to be transacted in Singapore in recent years.

The low-rise property, on a sprawling site of over one million sq ft between Tanjong Golf Course and Tanjong Beach, boasts the highly-acclaimed Spa Botanica and signature restaurant The Cliff. Other facilities include a conference centre. The hotel's 215 rooms include 37 suites and four garden villas.

It is being sold by HKR International, which developed the property. Sources suggest the buyer could be entities linked to Asok Kumar Hiranandani, co-founder of Royal Brothers.

He and his son Bobby, under their outfit Royal Group Holdings, are transforming the former Ogilvy Centre, a landmark conservation property along Robinson Road, to the 134-room Sofitel So, which will open by year end. Royal Group also owns two hotels in Singapore's Chinatown area and earlier this year bought the former Ritz Carlton Double Bay in Sydney, which will undergo a revamp and be managed by InterContinental Hotels Group.

Market watchers reckon that Royal Group would probably engage a new hotel operator for The Sentosa, which is currently managed by HKR Asia Pacific, a unit of HKR International.

Industry players are not surprised by the pricing for the transaction, taking into account its positioning and balance lease tenure. Earlier this month, a deal was inked for the freehold Grand Park Orchard hotel including its retail podium Knightsbridge at $1.16 billion.

Assuming the retail space is valued at $9,500 per square foot, the 308-room hotel would be valued at nearly $1.5 million per room. A higher price of $10,000 psf for the retail space would translate to a hotel pricing of close to $1.4 million per room. Park Hotel Group is selling the property to Bright Ruby Resources, a Singapore-incorporated vehicle controlled by the Du family in China that is involved in diversified businesses.

Around the same time, The Gallery Hotel, a freehold property in the Robertson Quay area, also changed hands at $232 million. On a headline basis, the pricing translates to slightly over $1 million per room, although this figure would be lower if the hotel's sizeable commercial space component is taken into account.

The Ngo family is selling The Gallery Hotel to RB Capital, founded by Kishin RK, the son of the other Royal Brothers co-founder, Raj Kumar Hiranandani.

Get The Business Times for more stories.