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Hiap Hoe ventures into UK hospitality industry with hotel buy in Manchester
PROPERTY company Hiap Hoe on Friday announced that it has, through subsidiaries, signed a sale and purchase agreement to buy Holiday Inn Express in Trafford City, Mercury Way, Manchester, from Topland (No. 18), Mill Lane Estates, and Marick Capital.
The purchase price of £26.3 million (S$46.2 million) is equal to its net asset value, after taking into account a valuation report prepared by an independent professional valuer, trade projections for the hotel and the recently transacted prices for other hotels in Manchester.
The consideration will be fully funded through a combination of internal resources and debt, Hiap Hoe said.
The hotel is a limited service hotel close to the Trafford Shopping Centre and EventCity, a large exhibition and conference venue. It is managed by Tower Hotel Management, a subsidiary of The Peel Group.
"The directors believe that the good location of the hotel, being in the high growth region of Manchester, together with a world leading brand in Holiday Inn Express and the strong management team put in place by the hotel manager, represents an ideal opportunity for the group's maiden foray into United Kingdom's hospitality industry. The acquisition would also allow the group to further strengthen its recurrent income stream," Hiap Hoe said.
The hotel is not expected to have a material impact on the consolidated net tangible assets per share and consolidated earnings per share of the company for the financial year ending Dec 31, 2017.