Northstar

BUSINESS www.travelweeklyweb.com Four Seasons Hotel Sydney sold to Korean investor SYDNEY – The Four Seasons Hotel Sydney has been sold for AU$340 million (US$306.8 million) to Korean investors, Mirae Asset Global Investments. The hotel was jointly marketed by Jones Lang LaSalle's Hotels & Hospitality Group and McVay Real Estate on behalf of Eureka Funds Management. "We are delighted with the sale of the hotel which was in response to Unitholders' desire to crystallise the strong profit growth over the past four years in a period where returns from other property Four Seasons Hotel Sydney's porte-cochère asset classes has been somewhat muted," said Glen Boultwood, fund manager, Eureka Funds Management. The purchaser, Mirae Asset Global Investments, is one of the largest financial institutions in Korea, Locally, Mirae Asset's investment into the hotel will be managed by Millinium Capital Managers, a Sydney based firm. Mirae Asset Global Investments manages US$58 billion in assets globally and has invested in commercial real estate properties in Brazil, China, India and the United States. "The sale of the Four Seasons Hotel Sydney saw investors from China, Hong Kong, Singapore, Korea and the United States competing for the iconic hotel. In my 19 years of brokering hotel deals, I have never seen a stronger investment market for CBD Australian hotels," said Craig Collins, chief executive officer, Jones Lang LaSalle's Hotels & Hospitality Group, Australia. The 531-room property overlooking the Sydney Harbour Bridge and Opera House at Circular Quay underwent an extensive AU$45 million (approximately US$40.6 million) refurbishment programme over recent years, including the addition of a new restaurant, bar and substantial state-of-the-art conferencing facilities. Sydney continues to be Australia's hottest hotel investment market accounting for circa 60 per cent of the total transaction volume so far in 2013 including the sale of the Ibis King Street Wharf, Diamant Sydney, Mercure Potts Point and Ritz Carlton Double Bay, with more deals expected to occur before the end of the year. Qantas halves losses SYDNEY – The Qantas Group had recently announced its full year financial reports; reporting an underlying profit before tax of AU$192 million (US$172 million) for the financial year up to June 30, 2013. This, however, is a result of benefits gained from a US$120 million accounting estimate change, involving and relating to the bringing forward accounting of passenger revenue. According to the Centre for Aviation (CAAPA), without this adjustment the underlying result would have been AU$58 million (US$52 million). The report reflects both positive and negative impact to the carrier's profit before tax (PBT). The negatives include the Dubai hub transition for its European flights (a move from its previous hub in Singapore), the carbon tax, pilot back-pay and additional startup losses in Jetstar's new ventures in Asia. The positives include the Boeing settlement disclosed at 1H13 and a AU$134 million change in accounting estimates, applied in the second half, for the recognition of passenger revenue when tickets have passed their scheduled travel date. Overall, these factors resulted in a net positive impact to Underlying PBT of AU$40 million. Against the backdrop of rising fuel costs, excess domestic capacity, this may be a reflection of the carrier's path to mend its international business, particularly the impact of its alliance with Emirates – costs are removed with the axing of routes that have brought them losses, 14 | ■ TRAVELWEEKLY ASIA | SEPTEMBER 2013 The Qantas-Emirates partnership has helped halve the Australian carrier's losses for FY2013 and aircraft reconfiguration, particularly in Asia. Qantas International reported an Underlying EBIT loss to AU$246 million for the year, halving its losses, compared to the year before. "Our financial position has been strengthened by the actions we have taken over past 12 months: reducing debt, extending our maturity profile and taking a prudent approach to capital expenditure". But Qantas has not provided profit guidance for the year ahead as the operating environment in the first half of FY2014 remains volatile," said Qantas' chief executive officer, Alan Joyce. www.travelweeklyweb.com

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