Sands' Marina Bay Integrated Resort win may impact upcoming Sentosa project
SINGAPORE: While the real work for Las Vegas Sands begins to get the project underway, the other bidders are setting their sights on the second resort at Sentosa.
Analysts say the result of the Marina Bay bid has implications on the Sentosa bid, which could attract even more players.
The Singapore skyline will change significantly in three years time. Although the Marina Bay plot of land is now empty, work will soon start on the Sands Integrated Resort.
"All four bids were very very good. Any one of them individually would have done us proud and would have made a big difference to our achievement of our tourism objectives. We felt the Sands proposal was outstanding and it addresses systematically and comprehensively all our objectives. We have made the right choice. Now, we have to make sure they build quickly, efficiently and there are no hiccups, and harvest the fruits that we have planted," said Community Development, Youth and Sport Minister Dr Vivian Balakrishnan.
Construction of the Marina Bay Sands could begin as soon as the final design proposals are accepted.
Analysts say the big challenge for Sands is getting the construction started, especially laying the foundation for the reclaimed land at Marina, and this could be an interesting time for construction companies in Singapore as well.
"If you look purely on architectural aspect, it's very clear the Sands' design is quite superior with respect to the layout and its link with the nature, environment that actually stands out. And the next key thing is the ability to attract the right kind of tourists, which is the MICE crowd. They spend more than twice of what the average tourist spends," said Gabriel Yap, senior dealing director from Phillip Securities.
With Sands winning the Marina bid, analysts believe it will have an impact on the Sentosa project.
For one, it could attract even more players.
Sands was seen as an underdog, but analysts believe its surprise victory could encourage others to try their hand for Sentosa.
The government's transparent selection process also showed, the winner was chosen on the merits of its proposal.
"I think a lot can be learned from this particular process. I would think for the Sentosa bid, the submission of Genting and Universal Studios plus the Star Cruise consortium will stand a better chance. Historically they have catered to the family and touristy crowd which is more oriented to an amusement park-and-ride kind of scheme," added Yap.
At least 6 bidders are vying for the Sentosa prize.
The closing date of the request for proposal ends in early October, and a winning company could be announced before the end of the year. - CNA /dt
CDL group to inject 4 S'pore hotels into $846m Reit
It will be listed jointly with a business trust
By Nande Khin May 27, 2006 The Business Times
(SINGAPORE) Property tycoon Kwek Leng Beng is putting four of his Singapore hotels and a shopping mall here worth some $800 million in a widely-anticipated real estate investment trust which will be launched together with a business trust in a stapled group to be listed on SGX.
A statement by Mr Kwek's City Developments Ltd (CDL) yesterday said that its 53 per cent-owned Millennium and Copthorne Hotels (M&C) will be setting up a group called CDL Hospitality Reit Group.
The stapled group comprises of CDL Hospitality Reit (H-Reit) and CDL Hospitality Business Trust (HBT).
H-Reit's initial asset portfolio will comprise Orchard Hotel, Grand Copthorne Waterfront Hotel, M Hotel, Copthorne King's Hotel and Orchard Hotel Shopping Arcade which are worth a total of $846.3 million.
The properties altogether generated a revenue of $152.5 million for the year ended Dec 31 2005 and a before-tax profit of $39.8 million.
H-Reit will acquire from CDL a 75-year leasehold in Grand Copthorne Waterfront Hotel. It will also acquire from M&C's wholly owned subsidiaries 75-year leasehold each in Orchard Hotel, M Hotel and Orchard Hotel; and from an M&C unit, the remaining 61-year term of a 99-year leasehold interest in Copthorne King's Hotel.
Since H-Reit and HBT will be launched in a stapled group, their respective units cannot be traded separately. H-Reit and HBT will be managed by M&C's wholly owned units M&C Reit Management and M&C Business Trust Management Ltd respectively.
M&C, through a wholly owned subsidiary, is expected to subscribe for about 39 per cent in CDL Hospitality Reit Group, funded through the proceeds of the disposal of Orchard Hotel, M Hotel, Copthorne King's Hotel and Orchard Hotel Shopping Arcade.
Through its interest in M&C, CDL will hold an indirect stake with an effective interest of about 21 per cent in the stapled group, said CDL's statement yesterday.
CDL also intends to use net proceeds from its disposal of Grand Copthorne Waterfront Hotel to reduce its bank borrowings and for working capital purposes.
CDL also said the flotation of the stapled group will 'unlock shareholders' value' in the Singapore hotel assets, and will enable CDL, through M&C, to 'pursue the twin strategies of revenue growth through increased fee-based income and increased investment exposure to hospitality and/or hospitality-related real estate. H-REIT will be an asset-owning vehicle focused on delivering stable and growing distributions and acquiring yield-accretive properties used for hospitality and/or hospitality-related purposes initially in Singapore, and eventually globally.
HBT, on the other hand, will be dormant at the proposed listing date but may become active going forward, said CDL. CDL has already been granted a conditional eligibility-to-list letter to list the stapled group on SGX's mainboard.
DBS Bank and HSBC have been appointed joint financial advisers, joint global coordinators and joint bookrunners for CDL Hospitality Reit Group's initial public offering
Comment: After unsucessful REIT arrangement with Suntec, CDL finally decide that it would be best for them to it themselves althought the reit is offering is on Hotel Reit instead of Retail Reit. Furthermore, Las Vagas Sand has won the IR Bid, look like CDL may need to generate a lot of cash for the IR project.
