Located on the Huangpu River in north the Bund, Shanghai, overlooking the scenery on both sides of the Huangpu River, looking at the Shanghai Lujiazui Finance & Trade Zone Development Co.Ltd(600663) financial center, only a few steps away from Shanghai’s “net red” classic Bai Bai Du bridge, the excellent location has made the Hyatt on the Bund Hotel, which was once one of the most profitable hotels in Shimao Group’s many hotels.
On January 28, through an announcement, Shimao Group sold the maoyue Hotel on the Bund to Shanghai real estate (Group) Co., Ltd. (hereinafter referred to as “Shanghai real estate”), a local state-owned enterprise in Shanghai, with a total price of 4.5 billion yuan, a 20% discount from the previous evaluation value of 5.6 billion yuan.
the hotel once had an annual income of nearly 400 million yuan, but now it is in a loss
It is reported that Shanghai Bund maoyue hotel has 631 rooms, including 48 suites. The hotel has 32 floors and 3 underground floors, covering an area of about 13700 square meters and a total construction area of about 109900 square meters.
According to the third-party platform, the standard room of Shanghai Bund maoyue Hotel starts at 800 yuan / night, the unit price of River View King room starts at 1400 yuan / night, and the suite can reach 8800 yuan / night. In 2019, the revenue of the hotel once reached 394 million yuan, and it is also one of the most profitable hotels under Shimao Group.
However, affected by the epidemic and other aspects, in 2020, maoyue Hotel on the Bund in Shanghai achieved a revenue of 169 million yuan, less than half of that in 2019, while in the first half of 2021, the hotel only achieved a revenue of 93 million yuan.
The sharp drop in revenue made Shanghai Bund maoyue hotel into a loss. According to the latest data announced, its after tax losses in 2020 and 2021 were about 56 million yuan and 64 million yuan respectively.
Shimao Group said that the transaction is expected to realize the sale income of about 3.01 billion yuan. About 80% of the proceeds from the sale are used to reduce the company’s liabilities and about 20% are used for general corporate purposes.
It is worth continuing to pay attention to that Shanghai Bund maoyue hotel is currently operated by Grand Hyatt Hotel under Hyatt Hotel, and Shimao Group used to have a cooperative relationship with Hyatt. After the sale of the hotel, the ownership of its operation right is unknown.
Shanghai real estate, established in 2002, is a wholly state-owned enterprise group approved by the Shanghai Municipal People’s government, with a registered capital of 30 billion yuan. The business scope of Shanghai real estate includes urban renewal, comprehensive real estate development, cross-strait development of Huangpu River, etc. By the end of 2021, the total assets of Shanghai real estate had exceeded 330 billion yuan.
The list of 34 items for sale came out, and Shimao Group did not respond positively to
In addition to Shanghai Bund maoyue Hotel, Shimao Group has sold three projects, namely Guangzhou Asian Games city project, Hong Kong Victoria Harbour exchange project and Shanghai North Bund project, with prices of 1.844.5 billion yuan, 2.086 billion Hong Kong dollars (about 1.696 billion yuan) and 1.06 billion yuan respectively. The total selling price of these three projects is about 4.6 billion yuan.
According to the Beijing News reporter, according to the current sales list, Shimao’s sales projects have reached 34, including 8 separate hotel assets. In addition to Shanghai Bund maoyue Hotel, it also includes Shanghai Shimao Sheshan Intercontinental Hotel, Shanghai Shimao Royal choice hotel, Nanjing Shimao riverside Hilton Hotel, Wuhan Shimao riverside Hilton Hotel Shanghai Shimao kanglaide Hotel, Shimao Yurong Wuyi resort, Shimao Zhaoqing Binjiang No. 1 urban complex.
Among them, Shanghai Shimao Sheshan intercontinental hotel is the “net red” deep pit Hotel, which is located in the deep pit of Tianma mountain in Sheshan, Shanghai. The architectural pattern is 3 floors above the ground and 16 floors underground, including 2 floors below the water surface. As the hotel is built in an 88 meter deep pit, it is the world’s first five-star hotel built in the pit, with an investment of 600 million yuan and a construction period of 8 years.
Shanghai Shimao Sheshan intercontinental hotel opened in 2018 and immediately became an online Red punch in hotel. In 2019, the hotel achieved a revenue of 279 million yuan; In 2020, it also received about 265 million yuan of income under the epidemic; In the first half of 2021, the revenue was 134 million yuan.
Under the liquidity crisis, Shimao Group had to “break its arm to survive” by selling the online red hotel. At present, the hotel business of Shimao Group is greatly affected by the epidemic. It had planned to spin off the hotel sector business listing, and finally this plan had to “run aground”.
Judging from the 34 projects for sale, most of them are located in the core first and second tier cities, including residential projects in high-quality lots, more hotel and commercial complex projects. The large-scale commercial complex projects such as Shimao Shenzhen Hong Kong International Center, Changsha Shimao global financial center and Hangzhou Shimao smart gate, although located in a superior position, have a long investment cycle and high holding cost, which may be the reason why Shimao Group chooses to sell such projects.
“In the current environment, it is the key for enterprises to be willing to take over, so only high-quality assets can be sold, and the sale of projects should be carried out as soon as possible, so there will be room for self-help.” For the asset sale of Shimao Group, a relevant person close to Shimao Group said.
Shimao Group did not respond positively to the list of the above 34 items for sale. Its internal stakeholders told the Beijing News: “there are indeed some high-quality projects under discussion one after another. The progress and price are in the process of negotiation, and the specific quantity and amount have yet to be agreed. Once the transaction is determined, it will be announced.”
