By Pooja Thakur and Nichola Saminather
Oct. 25 (Bloomberg) -- Far East Orchard Ltd., a unit of
Singapore’s largest closely held developer, is considering
listing a hospitality trust in Australia to hold assets it
acquired in the country this year.
“We definitely are looking at the possibility,” Lucas
Chow, Chief Executive Officer at Far East Orchard, said in an
interview in Singapore yesterday. “One way to recycle the
capital is to inject the asset into a REIT.”
Far East Orchard, which got almost all its revenue from the
island-state before it entered Australia for the first time with
two joint ventures, is expanding in the Pacific nation to
capitalize on growing tourist arrivals. The S&P/ASX 200 A-REIT
Index has gained 7.3 percent this year, compared with a 5
percent drop in the FTSE Strait Times Real Estate Investment
Far East Hospitality Trust, the company’s Singapore-listed
REIT, raised S$717.6 million ($580 million) last year. The trust
initially had 11 properties, seven of which were hotels and four
that were serviced residences in the island-state, according to
its offer document last year.
Far East Orchard is targeting 60 percent of revenue from
outside Singapore following the joint ventures with Toga Pty and
The Straits Trading Co. announced last year, Chow, 60, said in a
press conference in July, without specifying a time frame.
Overseas arrivals to Australia rose 6.7 percent to 530,900
in August from a year earlier, according to Tourism Australia.
The biggest increase in visitors was from China, Singapore and
Taiwan, the data showed.
The company is also seeking to develop real estate in
Australia, Chow said. Sydney, Melbourne and Perth are among
cities the company would target initially. Far East Orchard’s
presence in Sydney and Melbourne through its hotel venture, and
Perth’s proximity to Southeast Asia makes the cities attractive
investments, he said.
Far East Orchard, which owns a 70 percent stake in a joint
venture with The Straits Trading, will own three hotels in
Australia, according to the company. It bought a 50 percent
stake in a venture with Toga for A$225 million ($216 million).
Toga manages more than 50 hotels and serviced residences across
Australia, New Zealand, Germany and Denmark under brands
including Adina and Vibe.
Far East Orchard operates about 80 properties with more
than 13,000 rooms, according to a presentation by the company in
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--Editors: Tomoko Yamazaki, Andreea Papuc
To contact the reporters on this story:
Pooja Thakur in Singapore at +65-6311-2496 or
Nichola Saminather in Sydney at +61-2-9777-8613 or
To contact the editor responsible for this story:
Andreea Papuc at +852-2977-6641 or