Singaporean buys Hilton Auckland

Dean Humphries, Jones Lang LaSalle Hotels executive vice-president, brokered the deal. Photo / Steven McNicholl

Singaporean entrepreneur Michael Kum has signed an unconditional deal to buy the five-star, 165-room Hilton Auckland.

Dean Humphries, Jones Lang LaSalle Hotels executive vice-president, said he brokered the deal, the largest sale of a New Zealand hotel this year.

Via his investment company M & L, Kum has applied for Overseas Investment Office permission and the ground-floor Overseas Passenger Terminal used for cruise liners is included in the deal.

M & L already owns Sydney's largest hotel, the Four Points by Sheraton, and the former Hotel So, rebranded All Seasons Christchurch Cashel St.

The Australian Financial Review reported how the Kum family had "just bought a hotel on Princes Wharf, fronting Auckland's CBD", telling how his business was expanding but was heavily weighted towards Australia.

In April, M & L was planning a Singaporean real estate investment trust to include Australian assets but this was deferred. As part of that plan M & L had wanted to raise up to S$463 million in a float.

The Kums' family business has been acting as an investment vulture, buying 11 hotels in Australia, New Zealand, Singapore and Japan in flat conditions since 2009.

To sell the Hilton Auckland, Humphries launched an international marketing campaign last August, visiting Singapore, Kuala Lumpur, Hong Kong and Sydney to meet prospective buyers. The firm's London and New York offices were also involved.

Hilton will remain on the Auckland site, despite the sale.

The American operator is in place till 2021, after signing a long-term management contract.

Brian Fitzgerald, an Auckland-based investor of Triumph Capital, said last year that the property belonged to a number of parties including Willeston Capital.

ASB holds a mortgage over the property but Princes Wharf developer David Henderson's top-floor apartment is not part of the sale.

The hotel is subject to a 100-year ground lease. A term of 83 years remains.

Ground rent has been paid until September 2095.

M & L
* Investment company run by Singaporean Michael Kum.
* Bought 11 Asian, Australasian hotels since 2009.
* Has Four Points by Sheraton in Sydney.
* Owns All Seasons Christchurch in Cashel St.
* Owns Hilton Nagoya in Japan.