R&F RECOVERS FANGS AFTER ‘HIATUS’
Developer now the world’s biggest luxury hotel owner after Wanda deals
ONCE the leader of the elite group of developers known as the “Five South China Tigers”, Guangzhou R&F Properties gradually became overshadowed by bigger beasts, but it’s now back in focus even as many rivals shy from the limelight.
The developer, with a market value of HK$52.5 billion (RM28.64 billion), has grabbed international headlines over the past few weeks with two property deals linked to one of China’s richest men, Wang Jianlin, and his Dalian Wanda Group.
On Tuesday, R&F said it had teamed up with China’s CC Land to buy Nine Elms Square in London in a £470 million (RM2.59 billion) deal.
R&F stepped in after Wanda scrapped plans to buy the property, the latest setback for Wanda as Beijing tightens controls on overseas investment.
The purchase came just weeks after R&F bought 77 hotels from Wanda for 19.9 billion yuan (RM12.82 billion), as part of a US$9 billion (RM38.48 billion) restructured deal.
The pair of deals has prompted some analysts to suggest the Hong Kong-listed company is a white knight of billionaire Wang’s conglomerate.
Wanda has become a target in China’s clampdown on capital outflows, and sources say Chinese banks have been told to stop providing funding for several of its overseas acquisitions in order to curb its appetite for offshore deals.
“Wang Jianlin and I are longtime friends,” said R&F chairman Li Sze Lim said at an earnings conference, here, on Tuesday. “We bumped into each other in an event in Beijing, and struck the deal after 20 to 30 minutes,” he said, referring to the hotel purchase last month.
If indeed it took less than 30 minutes to strike a US$3 billion deal, the pair must certainly be well-acquainted. Sources say Wanda approached R&F about taking on some of the assets from the initial deal with Sunac China in order to speed up full payment.
Together with Country Garden, China Evergrande Group, Agile Group and Hopson Development, the five Guangzhoubased property developers are commonly known as the “Five South China Tigers” for their aggressive business style.
Partnering with luxurious hotel management groups such as Hyatt Hotels and InterContinental Hotels, R&F owned 34 high-end hotels across China prior to the deal with Wanda. With 111 hotels in total, it has become the world’s biggest luxury hotel owner.
The developer, which is awaiting a dual-listing in mainland China, has developments in Malaysia and Australia, which accounted for four per cent of R&F’s total contracted sales in the first six months of this year.
R&F added its footprint in the United Kingdom earlier this year after snapping up Nestle Tower in south London for around £60 million and Vauxhall Square for £157.77 million.
On Tuesday, the developer posted a 22 per cent rise in core profit in the first six months to 2.1 billion yuan, and it raised its fullyear sales target to 80 billion yuan, 31 per cent higher than the sales achieved last year. Reuters