HNA Group Co (海航集團) agreed to sell a Sydney office building to Blackstone Group, people familiar with the matter said, in what could be the acquisitive conglomerate’s first-ever disposal of an overseas property as it struggles with mounting debts.
Blackstone Real Estate Partners Asia agreed to pay about A$200 million (US$161 million) for the building at 1 York Street, said the people, who asked not to be identified because the sale has not been publicly disclosed.
HNA bought the building for US$129 million in 2011, Real Capital Analytics data showed.
Photo: Bloomberg
The sale comes as the Chinese conglomerate comes under mounting financial pressure after the group spent tens of billions of US dollars on a debt-fueled acquisition spree.
HNA’s debts surged last year as financing costs more than doubled, according to the group’s latest half-year financial report.
Since then, investor concerns about the conglomerate’s finances have increased, driving its borrowing costs higher.
Chief executive officer Adam Tan (譚向東) said in November last year that the group was looking to sell assets to conform with Chinese government policies.
HNA plans to sell buildings in New York and Sydney, while the company wants to cash out of properties in Hong Kong through real-estate investment trusts, he said, without elaborating.
In Hong Kong, HNA is taking the rare step of inviting outside investors to buy into two Hong Kong plots it purchased for US$1.8 billion just more than a year ago.
The conglomerate was said to approach brokers earlier about the possible sale of two office buildings in London’s Canary Wharf financial district and is also seeking to dispose its stake in 1180 Avenue of the Americas building.
This is not HNA’s first deal with Blackstone. The New York-based private-equity firm agreed to sell a 25 percent stake in Hilton Worldwide Holdings Inc in 2016.
Bloomberg LP chairman Peter Grauer is a non-executive director at Blackstone.
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