C&W concluded a 274-room four-star hotel transaction in Causeway Bay
Wing On Travel wanted to sell its 4-star hotel with nearly 100,000 sq. ft. in Causeway Bay, and at the same time maintained operation under its brand. The challenge to Cushman & Wakefield was to find an investor who had the capability to invest over HKD 800 million during the financial tsunami, plus setting up a sale and leaseback mechanism which could meet with the return requirement of the purchaser and at the same time cost effective to vendor’s operation.
Step 1: Identify potential purchasers and narrow down to a few of them for further negotiation.
Step 2: Carry out thorough analysis and due diligence check including land, building, technical, financial and legal matters, plus market information and comparables to facilitate the setting up of a transaction mechanism and sale and leaseback arrangement.
Step 3: Explain to all key decision makers the pros and cons and ensure a win-win situation between vendor and purchaser.
Cushman & Wakefield successfully introduced a fund in PRC to acquire the property from Wing On Travel, with the transaction price at HKD 833 million. The vendor was satisfied with the transaction price and at the same time kept the operation of the hotel under its brand. The purchaser was satisfied with the guaranteed return.