STAREIT TAKES OVER 3 AUSTRALIAN MARRIOTS

No longer A local REIT

Stareit has moved aggressively to accumulate premium assets. This tme it made significant 

forays down under to take over three Marriots-Sydney Harbour Marriott Hotel, Brisbane 


Marriott Hotel and Melbourne Marriott Hotel.

An outlay of RM1.315 billion is the total cash payout for this acquisition.

 The purchase consideration will be satisfied in cash via bank borrowings and cash balances 


of Starhill REIT upon receiving approvals from the relevant regulatory bodies.

Managing director of  YTL Corp/chief executive officer of Starhill REIT) Francis Yeoh  said 


that the acquisition of this new portfolio of hospitality assets would enlarge the REIT's 


portfolio to about RM3bil from RM1.58bil currently.

With the acquisition, more than half of Starhill REIT's property value will be constituted by 


its hotel assets in Australia and Japan, making this the largest portfolio of overseas property 


investments of any Malaysian REIT. So, the footprint of Stareit has changed character-wise 


with a large exposure in Australia. Wise move I guess since the Aussie dollar is solid as 


Gibraltar!

“The acquisition represents a yield accretive opportunity for the REIT, generating two 


income streams, firstly, stable fixed lease rentals arising from its existing property portfolio 


and, secondly, variable income from the three Marriott hotels, increasing the potential for 


distribution per unit growth and variations,” he said.

The Marriot, Melbourne

He added: “It will also allow Starhill REIT to participate in the vibrant real estate market in 

Australia and explore further geographical diversification of the REIT's asset base.”

The Sydney Harbour Marriott Hotel, built on a 3,084 sq m site on Pitt Street is in close 


proximity to reknown tourist attractions, including Circular Quay, The Rocks and the 


Sydney Opera House as well as the city's major office and retail precincts. The 33-floor 


building has 563 rooms.

The Brisbane Marriott Hotel sits on 1,532 sq m land and is located close to the Brisbane 


River and with a view of the Storey Bridge. It is a 28-floor building with 267 guest rooms.

The Melbourne Marriott Hotel occupies 1,636 sq m, located on the corner of Exhibition and


Lonsdale Streets with 16 floors and 186 rooms.

The three are five-star AAA tourism-rated hotels, situated on freehold land within the cities' 


Central Business Districts and operated by Marriot International Inc. Group group.

Starhill REIT currently owns ten (10) prime hospitality related properties with a total 2,690 


rooms and services residences units in Malaysia and Japan, namely the JW Marriott Hotel 


Kuala Lumpur, The Residences at the Ritz-Carlton, The Ritz-Carlton, Kuala Lumpur, the 


Pangkor Laut, Cameron Highlands and Tanjong Jara resorts, the Vistana chain of hotels in 


Kuala Lumpur, Penang and Kuantan and Hilton Niseko. As at 31 March 2012, the combined 


value of the Trust’s property portfolio stands at RM1,577 million.

The Trust was established on 18 November 2005 and Starhill REIT was listed on the Main 


Market of Bursa Malaysia Securities Berhad on 16 December 2005.


An an IPO price at 0.98 sen, STAREIT is an undervalued REIT.

Time to accumulate STAREIT on weakness, don’t you think?