Abu Dhabi National Hotels and Emaar Properties in discussions for hotel assets sale

Abu Dhabi National Hotels Company is in talks with Emaar Properties, Dubai’s biggest listed developer, over the sale of some of its hotel assets, it said on Thursday.

“Abu Dhabi National Hotels Company, as part of its expansion strategy in the UAE and abroad, is currently considering various investment opportunities, including the opportunity to buy some hotels owned by Emaar Properites,” it said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.

Separately, Emaar said is still in discussions over its hotel assets sale in a note to the Dubai Financial Markets on Thursday. It did not name Abu Dhabi National Hotels Company.

The planned sale of some of Emaar’s hotel assets could help fund a Dh10 billion retail complex at Dubai Creek Harbour as the emirate’s biggest developer seeks to become “asset light”, its chairman Mohamed Alabbar said in July.

Emaar Hospitality Group, a unit of the developer, plans to sell non-core assets including its hospitality portfolio except a handful of key valuable assets, to finance business growth and focus on hotel management contracts.

Emaar Hospitality owns and manages a portfolio of assets including hotels, golf clubs and restaurants. Its main hotel brands are Address Hotels and Resorts, Vida Hotels and Resorts and Rove Hotels.

The main objective of an asset sale would be to help Emaar have a lighter cost base, Mr Alabbar said at the time.

“The thing is, we should not be holding assets as a hotel operator. Hotel companies don’t own assets – Four Seasons doesn’t own hotels, Hilton doesn’t own hotels, but we own everything and will continue to own the majority,” he said.

Emaar, the developer behind the world’s tallest building, the Burj Khalifa, as well as other flagship properties such as the Dubai Mall, entered a strategic Dh30bn partnership with Abu Dhabi’s Aldar Properties in March, as they looked to streamline operations in a lukewarm market environment.

While the details of the partnership have yet to be fine tuned, Emaar posted a yearon-year net profit increase of 2 per cent for the second quarter, while Aldar slumped by 28 per cent during the same period.

Net profit for the three months ended June 30 rose to Dh1.48bn for Emaar.