A South Korean financial services group has emerged as the likely buyer for two of Orange County’s poshest coastal resorts, which could trade hands for $900 million or more on a combined basis.
Mirae Asset Financial Group, which reports having more than $400 billion of assets under management, has told South Korean media that it’s planning to buy a collection of 15 upscale hotels in the U.S. that are being unloaded by troubled Chinese insurer Anbang Insurance Group.
Anbang’s portfolio includes the Montage Laguna Beach and Ritz-Carlton Laguna Niguel; it bought them in September 2016 as part of a $5.5 billion portfolio buy from Blackstone Group LP.
The owner put that same collection back on the market late last year, after it was taken over by the Chinese government.
A sales price in the same $5.5 billion range for the entire portfolio is expected this time around, according to news reports.
Working on Terms
Mirae Asset is expected to make a nonrefundable deposit by the end of the month, and is attempting to line up financing for the portfolio, according to reports.
“The Mirae Asset consortium is planning to reach an agreement on purchase terms and will participate in the deal as a financial investor,” the company said in a statement provided to BusinessKorea.
“We will hold additional talks on the specific composition of the consortium after being selected as the successful bidder.”
Another bidder could still emerge, as Anbang Insurance hasn’t granted exclusivity to Mirae Asset, according to reports.
Mirae has other U.S. holdings, though it is not known to have sizeable investments in OC.
It bought San Francisco’s Fairmont Hotel in 2015, among other recent hospitality deals. Hospitality sources tell the Business Journal that the company was attempting to buy a large Marriott property in Los Angeles County earlier this year.
Lower Valuation?
When Anbang put the local Montage and Ritz Carlton properties on the market last year, Alan Reay, president of Irvine-based hotel consultant-broker Atlas Hospitality Group, suggested a likely value of the 260-room Montage at between $1.5 million and $1.7 million per room—equating to a price in the $420 million neighborhood.
The 393-room Ritz was worth about $535 million based on $1.35 million to $1.45 million per key, he said.
If a deal is completed near those valuations, they would be the largest two local hotel sales this year.
Atlas’ mid-year sales survey for California, released last week, indicated the largest sale in OC so far for this year was the $78 million, or roughly $307,000 a key, paid for the 254-room Newport Beach Marriott Bayview.
A lower price is possible, sources believe.
Mirae is “far more conservative than Anbang was, so the new valuation for the two iconic OC resorts will be telling,” one area hospitality executive familiar with the deal told the Business Journal last week.
Paul Hughes contributed to this article.
