Big Stamford plans Brisbane hotel part of Ow’s $1.4bn shake-up
SINGAPOREAN tycoon CK Ow is planning a $1.4bn shake-up of his Stamford Hotel empire in Australia which could see the repositioning of its leading CBD assets.
The Stamford Land Corporation is planning to spend about $780m on the redevelopment of the Stamford Plaza Brisbane and the Sir Stamford at Circular Quay in Sydney.
Both have been flagged by the company in the past as potential luxury apartment buildings.
SLC told the Singapore Stock exchange (SGX) that it is also seeking to spend about $70m to upgrade the Stamford Grand Adelaide and/or the Stamford Plaza Melbourne and around $640m in “opportunistic real estate acquisitions”.
The company said the ongoing projects will take about six years.
Over the past two years the coronavirus crisis has shaken the 5-Star hotel sector with city properties hard hit by international border closures and lockdowns.
In March 2020, SLC closed five of its hotels in Australia for a period and a number, including its Brisbane property, are being used as quarantine facilities for travellers during the pandemic.
The latest market update was a dramatic change in direction for SLC which announced last year that it was looking at putting much of its $1bn portfolio of Stamford Hotels in Australia on the market.
The company told the SGX last week that the possibility of divestments were “exploratory in nature” and had now ceased.
“However, the company may continue to receive unsolicited indicative offers for its hospitality portfolio from time to time and will update shareholders on any material developments on this,” SLC said.
To fund its $1.4bn strategy SLC is seeking to raise $S238.9m ($246m) through a proposed renounceable non underwritten rights issue.
The rest of the funds would come through debt financing and the use of the company’s cash and reserves.
Last year SLC flagged that it was considering options for the riverside Stamford Hotel Brisbane, which could be turned over to a residential or commercial project.
SLC has also worked up plans for a $400m rebuild of the Sir Stamford Hotel at Circular Quay near the Opera House into luxury apartments.
At the time SLC said its strategy was to continuously seek out the best use of its assets to optimise profits.
Mr Ow has long toyed with options for his Australian hotel portfolio.
In 2011, Singaporean property giant Ascendas agreed to buy three hotels – in Melbourne, Adelaide and Sydney – from Stamford for $316m, but that deal did not go ahead.