The purchase consideration, which is subject to post-completion adjustments, amounts to $5.85 million – of which $4.08 million has been paid to the seller of the property
CDL Hospitality Trusts (CDLHT) has indirectly acquired a 4-star hotel in Manchester, the United Kingdom. The total acquisition cost is around £24.1 million ($32.76 million), the managers said in a bourse filing.
The purchase consideration, which is subject to post-completion adjustments, amounts to £4.3 million ($5.85 million) – of which £3 million ($4.08 million) has been paid to the seller of the property. The remaining £1.3 million ($1.77 million) has been retained until certain conditions are met.
Had the acquisition been completed on Jan 1, 2021, and CDLHT held the property through Dec 31, 2021, the distribution per stapled security for CDLHT would have been S$0.0432 ($0.033) instead of S$0.0427 ($0.031), based on pro forma estimates.
As part of the transaction, a wholly-owned subsidiary of CDL Hospitality Real Estate Investment Trust (CDL H-Reit) on Tuesday entered into a share and purchase agreement with RAHoldingsUK to acquire Roundapple Hotel Partners III – which holds Hotel Brooklyn.
Roundapple Hotel Partners III holds a leasehold interest in Hotel Brooklyn with a remaining lease term of 196 years. It leases out the entire property to HLD (Manchester) – which is part of a group under Marshall Holdings, whose principal activities are in commercial development and construction.
The hotel has an independent property valuation of £25.3 million ($34.39 million) as at Dec 31, 2021. This is 10.9 per cent higher than its agreed property value of £22.8 million ($30.99 million).
The net asset value of Hotel Brooklyn is £4.4 million ($5.98 million), taking into account its agreed property value, as well as an £18 million ($24.47 million) in bank and shareholder loan amounts to be repaid by Roundapple Hotel Partners III at completion.
Hotel Brooklyn has been fully operational since May 2021, although it commenced operations in February before closing for business intermittently between then and April 2021.
