HNA to buy eight golf courses in the US for US$137.5m
Company positive about global golf tourism due to “continuing growth in the number and spending of high-net-worth outbound tourists from the PRC”
HNA Holding Group, the Chinese tourism and property investment company, has agreed to buy eight golf courses in Washington State in the United States for US$137.5 million, as it seeks to boost its portfolio overseas.
The eight golf courses provide a total of 180 golf holes with clubhouses and various amenities and cover 1,887.32 acres, the company said.
Xu Haohao, HNA Holding’s executive director, said in a statement released today that the company is positive about global golf tourism mainly due to “the continuing growth in the number and spending of high-net-worth outbound tourists from the PRC”.
He said Seattle, Washington State’s largest city, will be “an excellent gateway to tap into the North America golf tourism market.”
HNA Holding has entered into a lease with Oki Golf Management, whereby Oki will pay HNA an annual rent of US$7.1 million to use the eight golf courses for a period of five years. The rental yield is about 5 per cent, according to calculations by the Post.
HNA Holding, which came to the Hong Kong stock exchange through a back-door listing in 2013, is being developed into a major international investment arm of acquisitive HNA Group, headquartered in Hainan Province. In July, HNA Holding completed the acquisition of an office building in London’s Canary Wharf for £131 million.
HNA Group also owns Hainan Airlines, China’s fourth-largest carrier, which currently operates seven routes flying to five US cities, including from Beijing to Seattle. The flights will help guarantee the golf courses a certain number of visitors, David Ji, Knight Frank’s director and head of research and consultancy for greater China, said.
“Apparently the company wants to diversify its investment to boost return, and tourism property is one of the options,” Ji said.
He added that China’s outbound investment has touched a variety of areas in the tourism property sector in recent years, from hotels to wineries.
According to the statement, HNA Holding also owns and operates a golf club and resort in Dongguan city in China’s Guangdong Province, and expects to generate a synergy between the golf courses in the two countries.
Shares of HNA Holding remained unchanged in Hong Kong on Tuesday, closing at HK$0.35 per share.
