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CDL Hospitality Trusts unit renews lease on New Zealand hotel

A UNIT of mainboard-listed CDL Hospitality Trusts (CDLHT) has renewed its lease on a New Zealand hotel for another three years with the lessee, Hospitality Services.

CDLHT – a stapled group comprising CDL Hospitality Real Estate Investment Trust (CDL H-Reit) and CDL Hospitality Business Trust – said in a bourse filing on Thursday morning that CDL H-Reit’s wholly owned subsidiary, CDLHT (BVI) One, as lessor, renewed the deed of lease on Grand Millennium Auckland with the lessee.

The lessee is wholly owned by New Zealand-listed Millennium & Copthorne Hotels New Zealand.

The lease started on Sept 7, 2016 with a three-year term. It can be renewed for two further three-year terms, subject to mutual agreement. With this renewal, the second three-year term of the lease will commence on Sept 7, 2019 on the same terms.

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Grand Millennium Auckland is the largest hotel in New Zealand, with 452 rooms located in the gateway city of Auckland.

The lease renewal constitutes an interested-person transaction because Millennium & Copthorne Hotels New Zealand is a subsidiary of Millennium & Copthorne Hotels, which is in turn a subsidiary of City Developments Limited (CDL). CDL is a controlling holder of stapled securities in CDLHT.

The value of the transaction does not exceed 3 per cent of CDLHT’s latest audited net tangible assets, when aggregated with the value of all other interested-person transactions entered into with the same interested-person group in the same financial year.

Stapled securities of CDLHT last closed on Tuesday at S$1.61, up two Singapore cents from Monday’s close.