Abu Dhabi, UAESunday 23 February 2020

Bahrain's GFH acquires US hospitality portfolio in $250m deal

Further investment is planned to improve the properties spread across California, Connecticut and New Jersey

Bahrain-based GFH acquired 12 US hotels in a joint venture deal as the company continues to expand in the country. Reuters
Bahrain-based GFH acquired 12 US hotels in a joint venture deal as the company continues to expand in the country. Reuters

GFH Financial Group, a Manama-based investment bank, acquired a hospitality portfolio in the US in partnership with investment firm Arbor Lodging Partners, as it continues to expand in the country.

The deal worth $250 million (Dh1.03 billion) was executed through GFH Capital, a fully-owned subsidiary of GFH Group, the company said in a statement to the Dubai Financial Market, where its shares trade.

The joint-venture transaction will see Arbor taking a 9 per cent stake in the portfolio of properties spread across California, Connecticut and New Jersey. Arbor Lodging Management, an affiliate of US-based Arbor, will be managing the properties, GFH said.

The hotels fall under either a Hilton brand - Hilton Garden Inn, Hampton Inn and Homewood Suites - or a Marriott brand - such as Courtyard, Residence Inn and Springhill Suites.

GFH and Arbor will invest in improvement of these properties during the investment period, GFH said without specifying the amount of investment or the period.

GFH has over the past year increased its investment in the US. In July last year, the company acquired a portfolio of office buildings for Dh367m in the US that pushed the value of its investments in the country and the UK real estate sector to more than $1bn. It made the acquisition in partnership with Global Mutual, a real estate investment management company.

GFH, along with its investors, control about 95 per cent of the portfolio with the remainder held by Global Mutual.

In September, GFH also acquired six income-generating healthcare properties in the US worth Dh661m. The joint-venture deal gives Madison Marquette, a Washington-based real estate developer, a 6 per cent stake in the portfolio, while GFH and its investors hold 91 per cent.

In November the Sharia-compliant investment bank said it plans to invest Dh734m in the privately-owned schools sector through its new investment platform, Britus Education.

Earlier this year GFH raised $300m through the sale of a five-year sukuk. The deal, its first debt capital market transaction since 2008, was oversubscribed 2.5 times, with the order book exceeding $750m.

Updated: February 9, 2020 10:54 AM

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