KUALA LUMPUR, Australia—Starhill Real Estate Investment Trust ("Starhill REIT" or "Trust") is pleased to announce that it has, on 13 June 2012, entered into agreements to acquire the Sydney Harbour Mariott Hotel, Brisbane Marriott Hotel and Melbourne Hotel in Australia for a total purchase consideration of AUD415,000,000.
Starhill REIT entered into the agreements via its indirect wholly-owned subsidiaries and trusts to acquire the hotel properties and business assets of Sydney Harbour Marriott Hotel, Brisbane Marriott Hotel and Melbourne Marriott Hotel from the respective vendors of the hotels, namely Commonwealth Managed Investments Limited, 30 Pitt Street Pty Limited, 515 Queen Street Pty Limited and Lonex Pty Limited, for a total cash consideration of AUD415,000,000 (equivalent to RM1,310,570,000 based on the exchange rate of AUD1.00: RM3.158).
The purchase consideration was determined after taking into account the market values ascribed to the three Marriott hotels by the independent valuer, Colliers International Consultancy and Valuation Pty Limited. The purchase consideration will be satisfied in cash via bank borrowings and cash balances of Starhill REIT.
Tan Sri Dato' (Dr) Francis Yeoh Sock Ping, managing Director of YTL Corporation Berhad and Chief Executive Officer of Pintar Projek Sdn Bhd, the Manager of Starhill REIT, said, "The acquisition of this new portfolio of hospitality assets will, upon completion, enlarge the Trust's portfolio to approximately RM3.00 billion from RM1.58 billion currently. Thereafter, more than half of Starhill REIT's property value will be constituted by its hotel assets in Australia and Japan, making this the largest portfolio of overseas property investments of any Malaysian REIT.
"The acquisition represents a yield accretive opportunity for the Trust, generating two income streams, firstly, stable fixed lease rentals arising from its existing property portfolio and, secondly, variable income from the three Marriott hotels, increasing the potential for distribution per unit growth and variations.
"It will also allow Starhill REIT to participate in the vibrant real estate market in Australia and explore further geographical diversification of the Trust's asset base."
The Proposed Acquisition is subject to the relevant regulatory approvals and consents being obtained.