DUBAI, Sept 13 (Reuters) - Abu Dhabi Investment Authority
(ADIA) is selling two of its Sydney hotel properties which could
fetch the sovereign wealth fund (SWF) about $500 million, two
sources familiar with the matter said.
The two hotels, Novotel Sydney on Darling Harbour and IBIS
Sydney Darling Harbour, together have about 780 rooms and are
the last hotels to be divested from a 31-asset portfolio that
ADIA acquired in 2013, they said.
In 2016, ADIA sold 15 hotels in Australia to French hotel
owner and operator AccorHotels for A$200 million ($147 million).
These assets were among the 31 properties ADIA acquired from
Sydney-based Tourism Asset Holdings in 2013. The portfolio had
made ADIA the largest hotel owner in Australia.
ADIA declined to comment
ADIA has been investing in real estate since its creation in
1976. Real estate accounts for 5% to 10% of its portfolio.
Hotel occupancy has been hammered in Australia's biggest
cities as the country shut its international border when the
COVID-19 pandemic hit and as travel between Australian states
has been restricted. The impact has been partly offset as hotels
are used for quarantining returning Australian travellers.
Hotel occupancy dropped to a low of 45% in 2020, while more
than 5,000 new hotel rooms were added last year, according to a
Deloitte Access Economics report.
ADIA said in its annual review last week that accelerated
moves to more remote working, online shopping and less
international travel represented permanent changes to the real
estate industry but said it was hard to determine the scale of
"The real estate sector will need to adjust accordingly,
particularly through developing more flexible, multi-use spaces
and by meeting rising tenant expectations around amenities and
health and safety," it said.
ADIA, which Sovereign Wealth Fund Institute ranks as the
fourth-biggest SWF in the world with $650 billion in assets, is
headquartered in the capital of the United Arab Emirates and
manages the surpluses of Abu Dhabis earnings from oil exports.
($1 = 1.3592 Australian dollars)
(Reporting by Saeed Azhar and Davide Barbuscia; Additional
reporting by Sonali Paul in Melbourne; Editing by Edmund Blair)