The Real Deal Los Angeles

Anbang closes on acquisition of Essex House, 14 Strategic properties

The Chinese insurer will buy 15 of 16 hotels from $6.5B portfolio
September 28, 2016 08:30AM

Anbang's Wu Xiaohui and Essex House

Anbang’s Wu Xiaohui and Essex House

Anbang Insurance Group closed on its acquisition of the Strategic Hotels & Resorts portfolio from the Blackstone Group. The Chinese insurance company bought 15 of 16 of the U.S. properties, which includes the iconic Essex House in New York.

Anbang reached a deal with Blackstone in March to pay $6.5 billion for 16 hotels, but the purchase of the portfolio’s 16th and final property, Hotel del Coronado near San Diego, is under review by the inter-agency Committee on Foreign Investment in the United States, Bloomberg reported.

The deal is the biggest real estate purchase by a Chinese company in the U.S. to date, according to Bloomberg, and part of Anbang’s two-year shopping spree for foreign investments, including the $1.95 billion purchase of the Waldorf Astoria.

The Chinese insurer, which is looking to make a public offering in China, is best known in the U.S. for its aborted $14 billion bid to buy Starwood Hotels & Resorts, also in March.

In a move that mystified and rattled investors, Anbang first made a $12.9 billion bid for Starwood, which had already agreed to sell to Marriott, then after starting a bidding war, abruptly withdrew its offer, which had escalated to $14 billion.

Marriott completed its acquisition of Starwood last week.

Anbang is worth $120 billion, and owns properties in Belgium, Holland, the U.S. and Canada. It was one of a wave of Chinese companies investing in New York and U.S. real estate. The Real Deal looked at seven iconic properties owned by Chinese investors. [Bloomberg] — Chava Gourarie