Hong Kong-based firm Pioneer Global Group will invest $118.4 million to acquire an additional 20-percent stake in Kowloon City’s InterContinental Grand Stanford Hotel.
Owned by Gaw Capital, the family-owned-and-operated firm will also own 30 percent of the company holding the 503-room hotel, according to Pioneer’s statement. The real estate investment firm’s initial acquisition of this Tsim Sha Tsui-area hotel in July 2015 has been recorded as one of the company’s largest single asset transactions to date.
Pioneer and Gaw Capital’s involvement in the Supreme Key investor consortium with Korean sovereign wealth fund KIC landed them ownership of the InterContinental for $938 million. The firm is planning 18 months of renovations to the 570-room property, which are expected to begin this year.
Situated on the Victoria Harbor, the Grand Stanford’s amenities include four dining venues, an outdoor heated pool, a 24-hour fitness center and three meeting facilities. Former owner InterContinental Hotel Group will earn a profit of around $700 million on the hotel, which it owned since 2001. IHG expects to manage the hotel for another 67 years, having signed a 37-year management contract and three 10-year extension rights worth $8 million per year.
The sale of the InterContinental comes amidst IHG’s adoption of an “asset-light policy” to focus on operating hotels. This is merely one property in the rapidly increasing list of hotels Gaw Capital Partners is buying up. The private-equity firm reportedly closed a $1.3-billion bid for its Gaw Capital Real Estate Fund V Asian investment vehicle a month ago. Just over a month before purchasing the Kowloon waterfront hotel, Gaw led a conglomerate of Asian investors to acquire the 76-story Columbia Center office tower in Seattle for $725 million.
According to its website, Gaw Capital has six projects planned in Asia and the U.S., with locations including Bangkok, Beijing, Macau and San Francisco.