The acquisition was made by CDL Hospitality REIT’s wholly-owned subsidiary, CDL HREIT Investments (II), who entered into a share purchase agreement (SPA) with the RAHoldingsUK on the same day.
Under the SPA, CDLHT will acquire 100% of the shares of Roundapple Hotel Partners III Limited, which currently holds Hotel Brooklyn, from RAHoldingsUK.
The total cost of the acquisition is estimated to come up to £24.1 million ($43.8 million), which comprises the property consideration of £22.8 million, an acquisition fee of £0.2 million as well as an estimated stamp duty and other fees of £1.1 million.
Roundapple Hotel Partners III’s net asset value stands at £4.4 million, which takes into account the hotel’s agreed value of GBP22.8 million, bank and shareholder’s loan amounts of £18.0 million and adjusted for estimated negative net working capital of £0.4 million as at the time of the completion.
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The acquisition is expected to be accretive to CDLHT’s stapled security holders.
Based on the property consideration and net property income (NPI) of £1.7 million, the NPI yield of the property is 7.4%. On a pro forma basis for the FY2021 ended December, this translates to a distribution per stapled security (DPS) accretion of 1.1%.
Units in CDLHT closed flat at $1.22 on Feb 21.
Photo: CDLHT
