Abu Dhabi Investment Authority buys one of Australia's largest tourism companies in a move that expands its presence in Asia Pacific region.
Adia snaps up Australian hotel group
The cost of the transaction was not disclosed by either side, but the portfolio is understood to be valued at about A$800 million (Dh2.73 billion).
Most of the group's hotels are concentrated near the business hubs of the east coast.
This is also the region where a consortium that included Tawreed Investments, another unit of Adia, leased two ports in April for 99 years.
The A$5.07bn deal involved Port Botany in south Sydney and Port Kembla in Wollongong, a city in New South Wales.
"The portfolio would give Adia a unique and leading position in Australia," said Chiheb Ben Mahmoud, the head of hotel advisory at Jones Lang LaSalle, Middle East and Africa region. The hotel assets acquired are aligned with the key drivers and strengths of the Australian hospitality market."
Australia's prime hotels are a target market for cross-border capital with strong interest from Asia-based groups and on a more selective basis, from the Middle East and China, says Jones Lang.
The French hotel company Accor will continue to operate the TAHL properties. The portfolio includes hotels in the mid-market segment such as Pullman, Novotel, Mercure, Ibis, Ibis Styles and Ibis Budget brands.
Other sovereign wealth investors from the Arabian Gulf have also been eyeing investments in the hospitality sector. Qatari Diar, a unit of Qatar Investment Authority, is expected to buy the luxury W Hotel in Barcelona as well as another hotel in Montenegro, according to Property Weekly Europe magazine.
TAHL was formed in 1993 and privatised in 2002.
"We chose to run a discreet, targeted sale process and we were very pleased with the response we received," said Matt Eady, TAHL's chief executive in a statement referring to the Adia transaction. "This sale is the culmination of a successful four-year strategy since taking TAHL's platform independent in 2009."
In the Asia-Pacific region, Japan and Australia are the two most liquid markets for hotel property, Mr Ben Mahmoud said.
This year, Asia-Pacific hotel transaction volumes are projected to reach $3.5bn, above last year's volume at $3.3bn in which Australia dominated the number of deals, the Jones Lang report said.