$200m Kawarau Falls hotel complex deal

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Queenstown’s newly-opened Hilton hotels have been bought by a Singapore-based investment fund for about $200 million. 

Quilington Pte Ltd has taken over the two hotels – the Queenstown Hilton hotel and Kawarau Hotel at Kelvin Heights – plus about 75 residential apartments from Bank of Scotland International (BOSI). 

BOSI’s debt on stage one of the original Kawarau Falls Station project was about $400m. 

Quilington Pte Ltd is the property’s third owner. 

The original owner/developer was Aucklander Nigel McKenna’s Melview group of companies, which were placed in receivership two years ago, when the project was still half-completed. 

Since then the project’s been run by Auckland-based receivers KordaMentha, and financed by former first mortgagee BOSI. 

BOSI is partly-owned by the British taxpayer-owned Lloyds Banking Group. 

A property source, who doesn’t want to be named, says the Hilton complex – officially opened in June – “has been taken out of the hands of a party who didn’t want to own it into one that does and has a very positive outlook for the asset and the region”. 

The Hilton chain will continue to run the property’s 178-room five-star and 98-room four-star hotels, under a long-term management agreement. 

The fate of the unoccupied apartments is less clear. 

They were sold for about $1m each to Asian and British buyers, but they’ve never been asked to settle. 

Meanwhile, Quilington Pte Ltd has also taken over Auckland’s five-star Westin Hotel, which was also developed by McKenna interests. 

The company has also bought BOSI’s debt on Queenstown apartments formerly belonging to bankrupt Auckland developer Dan McEwan.