Anbang Insurance Group Co. has agreed to purchase 16 luxury resorts and hotels from Blackstone Group LP (BX) in a deal valued at $6.5 billion. The Chinese company proposed the largest transaction of American real estate from a Chinese company. Anbang has been steadily increasing its portfolio of real estate in the United States, viewing the properties as stable investments.
The acquisition will result in Anbang purchasing Strategic Hotels & Resorts Inc. Anbang will be the owner of many urban hotels, ocean resorts, mountain getaways and desert resorts in the United States.
Last year, the company purchased the Waldorf Astoria hotel in New York in a deal valued at $1.95 billion.
Blackstone purchased Strategic Hotels & Resorts three months ago and has been actively trying to sell individual properties within the company’s portfolio. Anbang countered the individual property sales with the proposal to buy the entire company for $450 million more than Blackstone paid earleir this year. The private deal allows Blackstone to receive short-term funding while allowing Anbang to enjoy a long-term investment. Philip Tee of Anbang’s North American unit and Christine Anderson of Blackstone have both declined to comment on the deal.
Anbang’s acquisition of the company marks a foray into U.S. real estate from China-based companies. China’s current struggling economy has caused many companies in the country to diversify their portfolios with overseas acquisitions. Anbang’s acquisition of Strategic Hotels came as a shock for analysts due to the company’s acquisition by Blackstone three months prior. Chinese companies attempted to purchase Starwood Hotels & Resorts (HOT) in recent months, but the sale of the company went to Marriott International Inc. (MAR). Strategic Hotel’s portfolio includes the Ritz-Carlton in Half Moon Bay; Four Seasons Hotels in Silicon Valley, Austin and Washington; Laguna Niguel in California; and InterContinental hotels in Chicago and Miami.