Cockpit International group has sold the 241-room Ibis Novena located at the corner of Balestier and Irrawaddy Roads for $118 million or $489,626 per room.
The freehold hotel opened in April this year. The buyer is said to be Singapore-based Grand Line International, controlled by the Kum family.
Market watchers say the pricing achieved for Ibis Novena reflects the steady appreciation in transaction prices for Singapore hotels, amid the tourism boom and limited hotel stock which is available for sale. Grand Line last year paid $390,334 per room for Ibis Singapore on Bencoolen in a $210 million deal.
In March, CDL Hospitality Trusts (CDLHT) paid $428,000 per room or $154 million for Studio M Hotel in the Mohamed Sultan area. For the first 12 months, CDLHT will receive guaranteed net rent of $9.24 million from the seller, Millennium & Copthorne Hotels (M&C) group.
Studio M and Ibis Singapore on Bencoolen were developed on 99-year leasehold sites sold by the Urban Redevelopment Authority.
According to Business Times, Cockpit International, controlled by the family of the late Teo Lay Swee, developed the Ibis Novena at a cost of about $70 million. Its sale of Ibis Novena comes with a long-term management contract with Accor to operate it under the Ibis brand.
The late Mr Teo used to own the former Cockpit Hotel at Penang Lane, which he sold in 1996 to Wing Tai. The site has since been redeveloped into the Vision Crest project.
Cockpit International group, which is now run by Mr Teo’s sons Kok Woon and Cheng Woon, today owns hotels in Australia, Auckland and London. It is understood to be looking for investments in London and Malaysia.
Grand Line is understood to be planning to list a hospitality real estate investment trust (Reit) on the Singapore bourse in the fourth quarter of this year.
The proposed Reit is expected to hold about half a dozen hotels worth about $1 billion in Australia, Japan and Singapore. These include Ibis Singapore on Bencoolen and the 630-room Four Points by Sheraton Sydney, Darling Harbour, which the family picked up for A$185 million in 2009.
Market watchers said they would not be surprised if the family’s latest acquisition, Ibis Novena, also makes its way into the Reit given the booming hotel market.