Perhaps the most well-known hotel in the world, a host to foreign dignataries, movie stars, cultural icons and the monied upper crust, now has a new owner. Hilton Worldwide Holdings has agreed to sell the Waldorf Astoria hotel in Manhattan to Beijing-based Anbang Insurance Group Co. for a reported $1.95 billion.
Hilton will continue to manage the 1,232-room hotel, which will subsequently undergo a major renovation, via a 100-year management contract with Anbang.
During Hilton's last Q4 call, the company hinted that a sale of the hotel could happen.
For its part, Hilton, which has owned the Park Avenue hotel since 1972, will reportedly use the proceeds from the sale to acquire additional hotel assets in the U.S. in one or more transactions.
In Hilton's official press release, Chris Nassetta, president and CEO of Hilton Worldwide, said, "We are very excited to be entering into this long-term relationship with Anbang, which will ensure that the Waldorf Astoria New York represents the brand’s world-class standards for generations to come. This relationship represents a unique opportunity for our organizations to work together to finally maximize the full value of this iconic asset on a full city block in midtown Manhattan."
In December, Blackstone Group took Hilton public, raising $2.35 billion in a record initial public offering for the hotel industry.
The Chinese Are Here
Anbang's acquisition of the Waldorf is indicative of a growing movement by Chinese investors to but U.S. hotel assets. In August, Shenzhen Hazens Real Estate Group Co., one of the largest development companies in China, purchased the Luxe City Center Hotel and two adjacent parcels for $105 million from Beverly Hills developer Emerik Properties Corp. The hotel is located adjacent to L.A. Live.
Chinese hotel developers continue to set their sights on international markets, fueled in part due to oversupply in mainland China and wanting to own hotels in overseas markets that cater to the growing population of Chinese travelers. Just look at what China's Wanda Group is up to.
On its website, Anbang Insurance Group calls itself one of the most comprehensive companies in the insurance business in China, providing services in property insurance, life insurance, health insurance, asset management, insurance sales agent and insurance broker.