HNA in $375M Deal to Add London Exhibition Centre to Global Portfolio

Fresh off major Manhattan deals earlier this month, HNA is turning its eye across the pond to grab another piece of London. The mainland investment conglomerate, together with Bugsby Property, is said to be in talks to acquire the venues division of the UK’s Capital & Countries Properties (CapCo), which owns the Olympia exhibition center in west London, for £300 million ($375 million), according to sources who spoke with Bloomberg.

The Olympia, a London landmark originally built in 1886, combines seven venues covering a total of 42,910 square metres. Should HNA’s bid be successful, the Chinese company would add the Olympia to a pair of previous property acquisitions on London’s Canary Wharf as part of a growing global portfolio.

The sources added that HNA weren’t the only ones interested in this chunk of west London, with a separate bid from a group including real estate private equity firm Yoo Capital and a German company also being considered.

CapCo Capitalizing on HNA’s Shopping Spree

CapCo has actually been looking to unload the venues unit since 2015, despite a brief bounce in venues profits in June of 2016 that caused CapCo to put the sale on hold. The CapCo venue attracted 1.5 million visitors in 2016 and earned an EBITDA of £19 million ($23 million), up 29 percent on 2015, according to Capco’s 2015 annual report. In 2016, however, the company stated that the property value of the company’s events business fell 1.3 percent.

Luckily for CapCo, HNA has been on a world-class drive to acquire properties in major global market. The parent company of China’s Hainan Airlines made its London debut in 2015 HNA by purchasing 30 South Colonnade in London’s Canary Wharf. The Chinese group acquired the 10-story structure otherwise known as the Reuters building from Germany’s KanAm Grund Group for an undisclosed sum.

Just a few blocks away, HNA early last year acquired 17 Columbus Courtyard, E14, from Brian and Mary Patricia O’Donnell’s Vico Capital for £131 million (now $163 million), plus around £9 million in transaction costs.

Meanwhile, over in North America, HNA has been very active in Manhattan recently. In just the last few weeks reports surfaced that HNA was considering paying $2.2 billion for a skyscraper on Park Avenue, and it was later announced that they would be selling the 1180 Avenue of the America’s building that they acquired in 2011.