Host, RECO Enter JV for Asia, Australia Investment
- Mar 25, 2008
Host Hotels & Resorts Inc. and RECO Hotels JV Pte, an affiliate of GIC Real Estate Pte of Singapore, have entered into a joint venture, structured as a Singapore corporation, to “explore investment opportunities” in Asia and Australia. GIC Real Estate is the real estate investment company of the Government of Singapore Investment Corp. Pte The partners have reportedly agreed to invest a maximum of $600 million of equity, which they anticipate leveraging into a total investment potential of $1.5 billion to $2 billion. Host owns a 25 percent interest in the JV and has the potential to earn a promote based on achieving certain return thresholds on each party’s equity investment. An affiliate of Host will provide asset management services on a fee basis. Host’s relationship with GIC isn’t new. In July 2007, a joint venture consisting of Host; an affiliate of GIC Real Estate Pte; and Stichting Pensioenfonds ABP, the Dutch pension fund for public employees, completed the purchase of three hotels in Brussels, financed through a 70.5 million-Euro mortgage loan. The acquisition brought to 10 the number of hotels owned by that JV, including properties in Barcelona, Madrid, Rome, Milan, Venice, Warsaw and the United Kingdom. An S&P 500 and Fortune 500 company, Host is one of the largest owners of luxury and upscale hotels and the largest lodging REIT. It currently owns 119 properties totaling approximately 64,000 rooms and representing such hotel flags as Marriott, Ritz-Carlton, Westin, Sheraton, St. Regis, Fairmont, Four Seasons, Hilton and Swissotel.