Real estate developer TEE Land is setting up a joint-venture (JV) company called Potts Point Hospitality with two partners: Peter & Jan Clark (Levey Street), and Kenmooreland.
An initial paid-up capital of $81.68 will be invested in the JV to buy the Diamant Hotel in Sydney, Australia. Potts has in turn signed a contract with KC Property to buy an existing four-star, 76-room boutique hotel on Kings Road in Sydney, Potts Point 2011, for $18.95 million. Potts is held by Tee Hospitality (a unit of Tee Land), Clark and Kenmooreland in the proportion of 55:10:35. The acquisition is expected to be completed in February 2015. It is also part of the group's strategy to build up a portfolio of recurring income generating assets in developed markets such as Australia and New Zealand that provide short- to mid-term accommodation to end users.
Clark and Kenmooreland are also Tee's JV partners in another of its Sydney hotels, Quality Hotel CKS Sydney Airport.
Tee Land will finance its share of the acquisition cost using internal funds and bank borrowings, it said.