Shenzhen-based Han’s Holding Group has filed a development application with development manager Touchstone Partners for a mixed-use project worth nearly $500 million in Sydney. If approved, the project would create one of the tallest buildings in the city, and could have more than 110,000 square feet of hotel space.
The proposed development will be built on a massive envelope comprising six blocks in the city center that had previously been purchased by Michael Guo-controled Visionary Investment Group. Guo has bought at least eight blocks worth about $490 million in the Sydney central business district over the past two years, along with his Chinese capital partners. Han’s Holding Group has been tapped to control the properties and will develop the precinct. The company already operates hotels in Switzerland and New York.
“We are an investment platform in property. We have different partners on different projects,” Guo told The Australian earlier this year. At the time, he did not mention Han’s Holding Group, which is controlled by Shenzhen entrepreneur Gao Yunfeng. Han’s had been the major partner of VIG, with a 95-percent stake in those properties. Sources have suggested that VIG may no longer be involved in the project.
Han’s Holding Group is proposing to spend $498 million to build a 67-story mixed-use development on the site that could surpass Sydney’s current height restriction for buildings thanks to a new 20-year planning strategy for commercial buildings.
Chinese Investment in Australia
If the plan goes through, it would only be the latest hospitality-related Australian project courtesy of Asian developers. "Clearly, the Chinese are taking a wide-ranging and long-term view when it comes to the Australian tourism market and this has been reflected in a series of astute and strategic purchases of Australian assets and business," Peter Harper, SVP of investment sales in JLL's Hotels & Hospitality Group, said in July. "Australia's reputation for economic stability, the record breaking performance of the hotel sector in cities such as Sydney and Melbourne, and ever-increasing air links have fueled the interest in Australian hotel assets by Chinese investors."
Major Asian acquisitions in Australia include the $445-million sale of the landmark Westin Hotel to Singapore's Far East Organization and Hong Kong's Sino Group, and the Sydney Hilton Hotel, which was sold to Singapore-based Bright Ruby for $442 million last year.
In July, Chinese group Tianlong Ribbon Property Unit Trust was identified as the buyer behind the $700-million hotel development proposed for Sydney’s Darling Harbour, to be called The Ribbon. The deal, which could be Australia’s largest hotel transaction, was made between private developer Grocon, take-out party Tianlong Ribbon, government landowner Sydney Harbour Foreshore Authority and U.S.-based Starwood Hotels & Resorts Worldwide.
As we noted earlier this year, approximately $11.42 billion in investment is earmarked to build new integrated casino resorts and expand existing ones across Australia, with the hope of attracting more Asian gamblers, of which Chinese are the largest market.