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GIC takes 51% stake in Sheraton Grande Tokyo Bay Hotel for S$627m

SINGAPORE — GIC said yesterday it will invest US$463.6 million (S$627 million) to take a 51 per cent stake in a joint venture to acquire the Sheraton Grande Tokyo Bay Hotel, as the Singapore sovereign wealth fund expands its footprint in Asia’s second-largest economy.

Sheraton Grande Tokyo Bay Hotel is located next to Tokyo Disney Resort. Photo: GIC

Sheraton Grande Tokyo Bay Hotel is located next to Tokyo Disney Resort. Photo: GIC

SINGAPORE — GIC said yesterday it will invest US$463.6 million (S$627 million) to take a 51 per cent stake in a joint venture to acquire the Sheraton Grande Tokyo Bay Hotel, as the Singapore sovereign wealth fund expands its footprint in Asia’s second-largest economy.

GIC will partner Invincible Investment Corp, a hotel and residential Japanese real estate investment trust, in the venture to acquire the property for about US$909.1 million. Built in 1988, the Sheraton Grande Tokyo Bay Hotel is a 1,016-room hotel that includes a 175-room annex tower opened last December. It is located next to Tokyo Disney Resort (TDR) and is the resort’s largest official hotel out of six such hotels.

Since its establishment in 1984, TDR has had a proven track record of growth, attracting more than 30 million park visitors annually in recent years, said GIC. Oriental Land, the operator of TDR, announced plans to add several new attractions at Tokyo Disneyland and Tokyo DisneySea, including a large-scale investment project of US$682 million to open new attractions scheduled in the spring of 2020 in Tokyo Disneyland.

Mr Lee Kok Sun, chief investment officer, GIC Real Estate, said: “Sheraton Grande Tokyo Bay Hotel, with its close proximity to Tokyo Disney Resort, has shown strong and resilient cash-flows. As a long-term value investor, we are confident in the continued growth and demand in Japan. In partnership with Invincible Investment Corporation, we will seek to enhance the Sheraton Grande Tokyo Bay Hotel and support it in its next phase of growth. We have been investing in Japan for more than 20 years and are continually on the lookout for quality assets with stable cash-flow potential.”

According to GIC’s latest annual report, about 12 per cent of its portfolio is invested in Japan. GIC achieved a 20-year annualised rate of return of 3.7 per cent above global inflation for the financial year ended March 31, 2017, it said. GIC does not reveal the size of its portfolio, but the London-based Sovereign Wealth Center estimates its assets under management at US$354 billion.

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