LUX* Resorts & Hotels sells Tamassa Resort for US$40 million in sale-and-leaseback deal
Speaking at the Africa Hotel Investment Forum in Kigali, Rwanda, Xander Nijnens, Senior Vice-President, Hotels and Hospitality Group, JLL Sub-Saharan Africa, announced that Lux Island Resorts Limited has entered into an agreement to sell its Tamassa resort on the Indian Ocean Island of Mauritius for US$40 million. Mauritius and South Africa listed real estate fund MaraDelta is set to acquire the property on a sale-and-leaseback basis that will see Lux Island Resorts continue as operator of the hotel. JLL Hotels & Hospitality Group acted as exclusive advisor on behalf of seller.
“We are very excited about this acquisition, our second in Mauritius and the first into a new asset class. The acquisition is expected to enhance our previously forecasted distributions,” says Ms Bronwyn Corbett, CEO of Mara Delta. “The seller, Lux Island Resorts Limited is listed on the Mauritian Stock Exchange and one of the largest hotel chains on the island and will guarantee the lease payments over the duration of the lease back.”
Adam Bury, Senior Vice President, JLL Hotels & Hospitality, Asia, commented: “Tamassa is a highly successful resort in an established yet still growing holiday destination. Mauritius is becoming increasingly popular, with tourism being a key driver for the economy. We expect to see significant investment in the island nation over the next five years, with more leisure travellers turning to Mauritius as an attractive addition to the diverse range of Indian Ocean destinations.”
International visitor arrivals to Mauritius increased by 10.3 percent year-on-year to June 2016 with France leading the inbound market. Europe is the principal source of tourists making up 57 percent of visitors. This growth has been supported by an increasing number of direct flights to the island nation, providing greater accessibility for tourists from the Middle East, Mainland China and Europe. Emirates operates two A380 planes daily to the island; Turkish Airlines launched a route from Istanbul in 2016; and AirAsia begins flights direct from Kuala Lumpur in October 2016, further increasing access from Asia, with Air Mauritius already providing direct flights from Singapore.
The lucrative Mainland China market in particular grew strongly in 2015 with visitor arrivals up by 41.4 percent year-on-year. This increase in tourists has been reflected in hotel occupancy, which was up by 13.7 percent in 2015 to 72.9 percent.
According to Nijnens, “The Mauritius market is on a strong growth trajectory due to improving air access and the status of Mauritius as a save destination. Following several years of subdued growth in hotel demand we forecast improving market performance in the medium term. The more favourable trading climate should allow local owners to recapitalise their hotels and firm up their balance sheets, whilst we expect foreign investors to increasingly look at the market.” Asian and Middle Eastern investment has been particularly strong into the Maldives and the Seychelles during the past five years and it is expected that more of this will flow south into Mauritius.
Desire Elliah, Chief Financial Officer, LUX Resorts & Hotels stated: “The sale of Tamassa is in line with the ‘asset light’ strategy of the Group and the proceeds will be used to invest in our brand by means of new, refreshed and reinvented properties. We would like to thank JLL for their contribution and getting the deal done.”
A four-star beach hotel, Tamassa occupies 350 metres of premier beach frontage and is 40 minutes away from Sir Seewoosagur Ramgoolam International airport. The 214-room resort fronts a pristine coral reef lagoon and is located close to championship golf courses and the world famous Le Morne Peninsula. Providing a comprehensive mix of facilities and services, it has been operating for more than nine years and is ranked seventh out of 178 hotels in Mauritius on TripAdvisor.