Host Hotels & Resorts and GIC Real Estate PTE Ltd announce the formation of an Asian joint venture (Singapore)
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Host Hotels & Resorts and GIC Real Estate PTE Ltd announce the formation of an Asian joint venture (Singapore)
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Category: Asia Pacific - Singapore
This is a press release selected by our editorial committee and published online for free on 2008-03-26
Host Hotels & Resorts, Inc. (NYSE:HST) and RECO Hotels JV Private Limited, an affiliate of GIC Real Estate Pte Ltd, have entered into a joint venture, structured as a Singapore corporation. GIC Real Estate is the real estate investment company of the Government of Singapore Investment Corporation Pte Ltd. The joint venture will explore investment opportunities in Asia and Australia. The partners have agreed to invest a maximum of $600 million of equity in the joint venture, which combined with the anticipated leverage provides total investment potential of $1.5 billion to $2.0 billion. Host Hotels & Resorts will own a 25% interest in the joint venture and potentially will earn a promote based on achieving certain return thresholds on each party’s equity investment. An affiliate of Host will provide asset management services and will earn fees for these services.
W. Edward Walter, Host Hotels & Resort’s president and chief executive officer said, “We are excited to expand our relationship with GIC, who is a terrific partner in general and an ideal partner for making investments in Asian markets. In addition, building on the success we are having with our European joint venture, we continue to believe that the joint venture structure is an effective and efficient way to enhance returns on our investments and diversify our portfolio holdings and revenue sources.”
Dr. Seek Ngee Huat, President of GIC Real Estate Pte Ltd said, "We are delighted to extend our existing relationship with Host Hotels & Resorts to Asia, where there are increasing investment opportunities in both emerging and developed markets. Combining Host's core skills in hospitality investment and asset management and GIC's regional presence and network, we believe that the joint venture is well positioned to build up a substantial portfolio of hospitality related assets in Asia."
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