Hong Kong firm Far East sells four-star Dorsett London for US$162 million in what could be British capital’s biggest hotel deal this year

FEC units Mazuma Holdings and Dorsett Hospitality (UK) sell property to Aldgate Hotel Bidco, a unit of US-based Highgate Hotels and Cerberus Capital Management

As of September last year, FEC operated 31 hotels in Asia, Australia and Europe

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The Dorsett City Hotel London in Aldgate High Street. The hotel has been acquired by Aldgate Hotel Bidco, a unit of US-based Highgate Hotels and Cerberus Capital Management. Photo: Handout

Published: 7:30am, 17 Jun 2021Updated: 7:30am, 17 Jun 2021

Hong Kong-based Far East Consortium (FEC) has sold its four-star 267-room Dorsett City London Hotel in Aldgate High Street for £115 million (US$162.1 million), the company said.

FEC units Mazuma Holdings and Dorsett Hospitality (UK) agreed to sell the property to Aldgate Hotel Bidco, a unit of US-based Highgate Hotels and Cerberus Capital Management. The sale is likely to give FEC, the largest operator of three-star hotels in Hong Kong, a recorded gain of about £50 million. FEC started operating the hotel in 2017.

“The sale is a good example of our proven track record of successfully monetising our hotel assets and is consistent with the group’s strategy,” said Chris Hoong, FEC’s managing director. “We have also demonstrated FEC’s ability to develop and operate hotels across the globe. The sale again highlights the tremendous value hidden in our portfolio. We look forward to exploring new opportunities to deploy capital at attractive rates of return.”

The Dorsett London sale is likely to be one of the biggest in terms of value in the British capital this year. Five hotel transactions in London so far in 2021 are estimated to have been worth about US$283 million, according to Real Capital Analytics. The 212-room Yotel Clerkenwell was sold for US$97.8 million in April.

As of September last year, FEC operated 31 hotels with about 8,100 rooms located in Asia, Australia and Europe. It has 13 hotels in the pipeline, including the Ritz Carlton Hotel in Melbourne. When all its hotels become operational, the company will own 44 hotels with about 11,350 rooms.

While hotels are among sectors worst hit by the coronavirus pandemic, not many assets in the industry were in distress, according to Govinda Singh, executive director, valuation and advisory services, Asia at real estate consultancy Colliers.

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