Anbang Insurance Group spent USD 6.5 billion for its acquisition of the company owning several large hotels in the US. The deal took only 3 months for agreement after the investment fund Blackstone had bought the firm in hotel business Strategic that is surprised the whole business insurance industry and all leading insurance companies, latest auto insurance news catching.
The acquired assets included Ritz-Carltons hotel in California, Essex House hotel in New York. According to reliable sources, Blackstone Group LP, a private-equity firm, agreed to sell Strategic Hotels & Resorts Inc to Anbang Insurance Group of China with the value of USD 6.5 billion, 3 months only after Blackstone acquired it.
This price is about USD 450 million higher than the price that Blackstone paid for Strategic on December. The private-equity firm in New York had planned to sell separate properties in the portfolio before Anbang Insurance Group proposed to acquire the entire of this company (According to a secret source).
Mrs. Christine Anderson, a spokeswoman of the Blackstone, declined to comment anything, like Mr. Philip Yee, the executive director of a subsidiary of Anbang Insurance Group in North America.
Del Coronado, a famous ancient hotel in San Diego, California, was acquired by Anbang Insurance Group of China. Built in 1888, the red roof hotel was the last asset in the chain of seaside of Victoria resorts in California. It borders pristine coastline with 1.5 miles in length and glistening beach by Mica minerals.
The giant M&A transaction marked an attempt to penetrate more and more deeply into the American hotel market of Anbang Insurance Group in Beijing, following to the acquisition of The Waldorf Astoria, a luxury hotel in New York City. According to Bloomberg, this is the largest acquisition of real estate in America ever by a Chinese company.
The Strategtic of America owns 16 hotels throughout the United States, including Jackson Hole, Wyoming; Four Seasons resort in Scottsdale, Arizona; the super luxury Ritz-Carltons hotel in Half Moon Bay and Laguna Niguel, California; JW Marriott Essex House hotel in Manhattan; San Diego Hotel del Coronado hotel.
The luxury and outstanding real estate of America always attracts high demand by foreign investors, especially Asia and the Middle East.
The luxury real estate became the largest objectives among recent years, partly because of its prime location and high cost of construction making difficulty to be replaced by competitors. Demand for well-known and typical hotels is still very large even when the American hotel industry are facing with the later stages of a 6-year economic recovery, with stalled growth rates of hotel prices and capacity utilization.
The American typical real estate continues to attract strong demand from foreign investors, including Asia and the Middle East, said Gilda Perez-Alvarado, an executive director of Jones Lang LaSalle Inc, a real estate broker. This demand is also motivated by the volatility of the global market and the higher and higher value of USD and trend of increase in investment allocation ratio for commercial real estate with the aim of diversification of the portfolios.
In February 2015, Anbang acquired Waldorf Astoria hotel located in Park Avenue, Manhattan, New York with a record price, USD 1.95 billion.
The Chinese investors acquired foreign assets in the context of the slowing down of economic growth in the country and the attractiveness in term of safety and value in American real estate. Anbang Insurance Group paid a record price of USD 1.95 billion in February 2015 to acquire Waldorf Astoria hotel in Park Avenue, Manhattan. The seller was Hilton Worldwide Holdings Inc, owned by private-equity firm Blackstone at that time. Anbang acquired or agreed to acquire big office buildings in New York and Canada.