Singapore-based ARA Asset Management has agreed to purchase the 434-room Conrad Seoul from Toronto’s Brookfield Asset Management for 400 billion South Korean won ($292 million), approximately $670,000 per room, according to Terence Baker of Hotel News Now. This transaction represents the largest hotel deal in South Korea for 2024, as reported by Korean business publication Maeil.
Initially, Brookfield Asset Management set the Conrad Seoul’s guide price at over $370 million, according to Mingtiandi, an Asian business media outlet. However, Korea JoonAng Daily had previously suggested an even higher estimate, noting a guide price of 1 trillion won ($750 million). Brookfield originally acquired the Conrad Seoul along with the International Financial Center (IFC) Seoul for 2.55 trillion won. The IFC Seoul, which includes a shopping center and three office towers, is not included in this latest transaction.
The Conrad Seoul, a 38-floor hotel, opened its doors in November 2012 and has since become a notable establishment in Seoul’s hospitality sector. A prior deal to sell the hotel and the IFC Seoul to Mirae Asset Global Investments in 2022 fell through due to regulatory requirements from South Korean financial authorities, which demanded a reduction in the debt level proposed for financing the acquisition, as reported by Mingtiandi.
This acquisition by ARA Asset Management marks the second major purchase by a Singaporean firm in recent months. In mid-May, City Developments Ltd.'s Copthorne Hotel Holdings acquired the 268-room Hilton Paris Opéra for €240 million ($259 million), equating to approximately €895,522 per room.
Jesper Palmqvist, senior director for Asia-Pacific at STR, CoStar’s hotel analytics division, highlighted the interesting dynamics of the Conrad Seoul sale, particularly noting the initial higher listing price and the failed transaction with Mirae. Palmqvist observed that while there is some movement in transaction volumes in Seoul, the market activity remains moderate. “It is hard to say how indicative [this deal] is, apart from the fact that the market pays what the market wants to pay. [There] hasn’t exactly been tons of deals there recently," he remarked.
The acquisition of the Conrad Seoul by ARA Asset Management underscores the evolving landscape of hotel transactions in South Korea and reflects broader trends in the hospitality market amidst varying economic conditions and investment strategies.
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