Hong Kong Scions Complete $75M Purchase of Osaka Hotels From CapitaLand Ascott Trust

A property investment firm backed by some of Hong Kong’s wealthiest families has completed its acquisition of a trio of Osaka hotels from CapitaLand Ascott Trust, with Axe Management Partners having paid JPY 10.7 billion ($75 million) for the assets.

The transaction, first reported by Mingtiandi last December, saw CLAS divest Hotel WBF Honmachi, Hotel WBF Kitasemba East and Hotel WBF Kitasemba West as part of what the Singapore-listed trust described as a portfolio reconstitution effort.

“We are very excited about the acquisition of this exceptional hotel portfolio with immense value-add potential,” said Axe founder and CEO Gary Kwok. “With flexibility in repositioning strategies, we will further invest capex and utilise our development and operational capabilities to transform these assets, creating a product that goes beyond expectations, driving performance and unlocking their true potential.”

Sam Lau, who co-founded Axe together with former Credit Suisse and Bank of American Merrill Lynch executive Kwok, is a son-in-law of Guangzhou R&F chairman and co-founder Li Sze Lim. Together with Jonathan Kwok, Lau, who serves as managing partner at Axe, also co-founded Astera Capital, a Hong Kong investment firm affiliated with New World Development CEO Adrian Cheng’s Flow Capital.

All in the Families

Market sources told Mingtiandi in December that CLAS was selling the trio of properties in central Osaka’s Chuo ward to an Alyssa Partners-managed fund backed by an unidentified offshore investor. From photos and bios supplied with press materials, Mingtiandi has identified the principals behind the investment. Alyssa declined to comment on the deal when contacted by Mingtiandi on Wednesday.

With offices in Tokyo and Hong Kong, Axe Management Partners bills itself as a pan-Asia real estate investment firm specialising in development, value-add and special situations. Founder and managing partner Lau said Axe foresees attractive opportunities in selected regions across Japan and Asia in the coming months.

“Japan has had strong momentum and we expect this will continue in the foreseeable future,” Lau said. “This investment underscores our commitment to Japan, where we plan to deploy more capital and make further acquisitions in the near future.”

Kwok, in addition to serving as CEO of Axe, has also served as president and chief executive of Tokyo-based hotel investment firm Agora Hospitality Group since 2018, according to Bloomberg. Astera co-founder Jonathan Kwok’s wife, Vickie Li, is a grand-daughter of Henderson Land Development founder Lee Shau-Kee.

Lau, who according to a bio on the Astera website previously worked as an investment banker at Deutsche Bank, also formerly served as chairman of Shenzhen-based investment firm Qianhai Heungkong Financial Holdings.

In August of last year, Axe signed a memorandum of understanding with Korea’s IMM Investment, with local news reports identifying New World’s Adrian Cheng as a co-founder of the company. The New World scion also founded Astera Capital Partners, which according to its website was established in partnership with Flow Capital, which was co-founded and is now chaired by Sam Lau.

In 2022, Flow Capital agreed to buy Guangzhou R&F’s Vauxhall Square project in London for £108.2 million (then $120.9 million) as the mainland builder struggled to meet its financial obligations.

Trio Set for Turnaround

Built in 2018, the three Osaka hotels have 518 keys and span 10,000 square metres (107,639 square feet) of gross floor area, with each asset within a 15-minute drive of Osaka Castle. Axe will work with hospitality giant IHG to refurbish and relaunch the properties under the Garner hotel brand for a targeted opening in the fourth quarter of this year, the company said Monday in a release.

All three assets are managed by Hotel WBF, a local chain that operates properties in Osaka, Hokkaido and Fukuoka. Hotel WBF filed for bankruptcy protection in 2020 with debts totalling JPY 16 billion, according to Japan Property Central.

A representative of CLAS’s manager told Mingtiandi that two of the hotels have been closed since the first half of 2020. The third asset, Hotel WBF Honmachi, also halted operations from January of last year until September, according to a statement from the hotel’s operator.

Each of the rebranded Garner hotels will boast its own design character and offer guests access to the IHG One Rewards programme with benefits like late check-out and room upgrades.

The hotels are situated close to Yumeshima, an artificial island that will host the 2025 World Expo starting in April 2025. The area will also be home to the country’s first casino, scheduled to open in 2029.

Note: An earlier version of this story indicated that Gary Kwok is a descendant of Sun Hung Kai Properties founder Kwok Tak-Seng. He is from a separate Kwok family. The story has also been updated to indicate that Vickie Li is not the wife of Astera’s Gary Kwok. She is the wife of Astera’s Jonathan Kwok. Mingtiandi regrets the errors.