Seoul’s luxury hotels are all up for grabs as Western investors stalk South Korea for bargains.
Daewoo Group has just sold the 682-room Seoul Hilton for US$215m to General Mediterranean Holdings SA of Luxembourg. The hotel is also South Korea’s largest conference centre.
Other top hotels now on the market include the Seoul Plaza, Scilla Hotel, Ramada, Hyatt, Intercontinental and Ritz Carlton. All are available on yields around 5%.
In the city of Pusan, Goldman Sachs’ Korean fund Jinsan Asset H&M LLC has bought the Hyatt Regency Hotel for US$33m.
Hotel investors are thought to be the most likely potential buyers but the hotel owners are holding out for full value, according to Brooke International executive director David Faulkner.
Traditionally, as in the case of the Hilton, Korean investors have looked on hotels as trophy investments. Faulkner said this is another reason for hotel owners keeping sale prices high.
Daewoo was forced to sell the Hilton as part of the IMF-led restructuring package which forced the giant South Korean conglomerates to concentrate on their core businesses. The group is also selling Daewoo Electronics.
Earlier this week, Chesterton Blumenauer Binswanger announced the formation of its Binswanger Korea operation.
EGi News 26/07/99
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