Stockland Group to sell Saville Hotel Group
Stockland property group plans to use the capital raised from the sale of its Saville hotel management business to generate high returns in its key operating divisions.
The diversified property developer today said it was an “appropriate time” to sell its Saville Hotel Group given strong demand in the market for hotel acquisitions.
“The Saville business is performing very well, but it represents a small component of Stockland’s overall group EBIT (earnings before interest and tax), less than one per cent, and is not a core focus for our business in the long term,” Stockland managing director Matthew Quinn said.
Mr Quinn said with its strong brand, consistent track record and continued improvement in room rates and occupancy levels, he expects Saville to attract significant interest from potential buyers both in Australia and overseas.
“We see many opportunities in our key operating divisions to generate high returns from the capital redeployed from the sale of Saville,” he said.
The Saville Hotel Group manages 11 apartment style hotels under lease agreements and management contracts with various third party owners in capital cities across Australia.
The business is expected to to be sold in one line as a going concern.
Stockland’s portfolio includes over $9 billion of commercial, industrial, office park and retail assets and residential development projects.
Its securities closed down five cents at $6.65.
