The Edge - Dynasty Hotel tops list of most expensive property for auction at RM210 mil

KUALA LUMPUR (Feb 11): Despite having gone under the hammer a few times since 2014, the reserve price of Dynasty Hotel (pictured) here has remained at RM210 million – making it the most expensive commercial property on the auction market last year, according to online auction listing platform AuctionGuru.com.my.

The platform’s executive director Gary Chia tells TheEdgeProperty.com that Dynasty Hotel has been up for bid at least twice in 2015.

"The reserve price of the property may not necessary drop even if it has gone under hammer a few times. It depends on [the] market value trend and also the owner and lending bank's decision. In some cases, if the auction property is located in an investment hotspot, its reserve price may even increase," Chia explains.

Opened in 1994, The Dynasty Hotel is a 28-storey four-star hotel with 788 hotel rooms, 25,063 sq ft of retail space on the ground and lower floors, 116,728 sq ft of office space and 499 parking bays.

According to the valuation report done by IPC Island Property Consultants Sdn Bhd in September 2013, it has a market value of RM378 million, giving the reserve price a 44.4% discount to its market valuation.

Another hotel property that boasts one of the highest values is Empress Hotel Sepang at Bandar Baru Salak Tinggi, with a reserve price of RM61.56 million.

The Empress Hotel is a 12-storey, three-star hotel with 320 rooms. It is 63km from the Kuala Lumpur city centre, and about 8km from the Kuala Lumpur International Airport and the Sepang International Circuit.

Dynasty hotel is owned by Dynawell Corporation, a wholly-owned subsidiary of former listed company Gula Perak Bhd, which delisted in 2011, while Empress Hotel belongs to KSB Requirements & Rest Sdn Bhd – a 70%-owned subsidiary of Gula Perak Bhd.

According to earlier reports, Gula Perak Bhd planned to sell the two hotels to Time Glory Investment Ltd -- a Hong Kong based company -- for a sum of RM193.9 million to repay company debts. However, after Gula Perak Bhd was delisted in 2011, there was no subsequent announcement regarding to the deal.

But documents show that the Shah Alam High Court has granted an order for sale of Empress Hotel land in January 2013 and the Kuala Lumpur High Court has granted an order for sale of Dynasty Hotel land in September 2013. 

According to the same document, the Shah Alam High Court has wound up Gula Perak Bhd in March 2013.

The two hotels remain unsold and will be put up for auction again in 2016.

Chia said Empress Hotel has a reserve price of RM85 million when it was first went under the hammer, but the reserve price declined to RM76 million in 2014.

By Tan Ai Leng / TheEdgeProperty.com | February 11, 2016 2:19 PM