S'porean buyer snaps up Ibis on Bencoolen

A subsidiary of Grand Line Int'l has paid over $200m for hotel: sources

(SINGAPORE) Ibis Singapore on Bencoolen, a three-star hotel that opened last year, has been sold for more than $200 million to a Singaporean buyer.

Hospitality group Accor and real estate investor LaSalle Investment Management said in a statement yesterday that they have sold the 538-room hotel. The partners did not disclose the sale price or the identity of the purchaser due to confidentiality obligations.

But sources told BT that a subsidiary of Singapore-based Grand Line International has paid more than $200 million for the property.

According to past reports, Accor and LaSalle put in $145 million to develop the hotel at Bencoolen Street after winning the tender for the site in 2006 in a 30:70 venture. The hotel opened in February 2009.

Accor, which owns the Ibis brand, will continue to manage the hotel under a long-term management contract.

'The sale of the hotel is in line with Accor's 'asset right' strategy where the value of the property is being realised with Accor continuing to manage the hotel with the Ibis brand, under a long-term management contract,' said Michael Issenberg, chairman and chief operating officer of Accor Asia Pacific.

Accor and LaSalle put up Ibis Singapore for sale through a private tender that began in May. The owners decided to formally offer the hotel for sale after receiving a number of unsolicited offers from investors.

Ibis Singapore now enjoys occupancies in the mid-90 per cent range and an average room rate of about $140, LaSalle said. In addition to the comprising 538 guest rooms, the property also has two retail outlets, two food and beverage outlets and 68 carpark lots.

'Singapore lacked quality inventory of economy hotel rooms, despite strong inbound demand from value-conscious travellers in Asia. Although around 80 per cent of travellers fly economy class, some 90 per cent of hotels rooms in Singapore were business or first class, so there was a clear market mismatch which we capitalised on,' said Andrew Heithersay, international director at LaSalle Investment Management.

Ibis Singapore is Grand Line International's first hotel asset in Singapore. BT understands that the company, which used to be in the shipping business, owns some properties in Australia.

Source: Business Times, 3 Aug 2010