Blackstone-owned Hilton sells New York's Waldolf Astoria to China insurer
China’s Anbang Insurance Group has agreed to buy the Waldorf Astoria hotel in New York from Hilton Worldwide Holdings, a portfolio company of The Blackstone Group, for $1.95 billion.
The property, which has been in its current location on Manhattan's Park Avenue since 1931, will continue to be managed by Hilton. The hotel will also undergo a major renovation intended to restore it to its historic grandeur.
Blackstone acquired Hilton through a $26 million buyout in 2007 - when the real estate market was at its pre-global financial crisis peak - contributing $5.6 billion in equity. The company went public in December 2013, raising $2.35 billion, and now has a market capitalization of $23.9 billion. Blackstone is understood to hold a 76% stake.
Over the last seven years, Hilton's luxury brand, Waldorf Astoria Hotels & Resorts, has expanded its footprint more than fivefold and now has 27 destinations worldwide. A further nine properties are in the pipeline. The Waldorf Astoria is the brand's flagship hotel. Proceeds from the sale will be used to acquire additional hotel assets in the US, Hilton said in a statement.
Headquartered in Shenzhen, Anbang Insurance Group is the parent of Anbang Property & Casualty Insurance, which was set up in 2004. Privately-owned Anbang has expanded aggressively into financial services and real estate within China. It now appears to be taking advantage of a relaxation in regulations in 2012 that allowed insurers to invest in private assets offshore, including real estate and private equity.
Chinese investors as a whole have become more active in US real estate in recent years. Private conglomerate Fosun International has been among the buyers, picking up a 60-floor tower at One Chase Manhattan in New York for $725 million in 2013.
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