Christchurch quake trips up $184M nationwide hotel buy-up

Christchurch quake trips up $184M nationwide hotel spending spree

By Paul McBeth

March 2 (BusinessDesk) – Global hotelier Host Hotels & Resorts LP has walked into some early problems in the $184 million buy-up of seven hotels in New Zealand, with two properties caught in last week’s Christchurch earthquake.

The Maryland-based company completed the acquisition on Feb. 18, just four days before the quake hit the country’s second-biggest city, killing at least 155 people and causing as much as $15 billion worth of damage.

Both the Novotel Christchurch on Cathedral Square and Ibis on Hereford St. were evacuated after the quake, and the company hasn’t been able to determine the extent of the damage to the buildings due to the restricted access in Christchurch’s central business district, according to documents lodged with the Securities and Exchange Commission.

Host Hotels & Resorts didn’t respond to emailed inquiries.

The deal, which gained Overseas Investment Office clearance in January, is part of the company’s expansion in the Asia-Pacific region where it is looking to buy upscale property, and acquire mid-range and top-end hotels.

The rest of Host Hotels & Resorts’ new portfolio includes the Novotel Queenstown Lakeside, Novotel Auckland Ellerslie, Novotel Wellington, ibis Wellington, and ibis Ellerslie. The 1,207 rooms in New Zealand is the biggest concentration outside North America.

The hotelier said it plans to significantly refurbish the hotels in the background to its OIO decision summary.

Host Hotels & Resorts bought six of the hotels from Tourism Asset Holdings, and one from Accor SA, taking on about US$80 million as part of the $184 million bill.

(BusinessDesk)

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