Crowne Plaza Changi Airport hotel to change hands for $500 mil, buyers eye AEI works
The proposed sale of Crowne Plaza Changi Airport will allow OUE Reit to unlock value before the hotel management agreement and master lease agreement expires in 2028. (Photo: OUE, Tokyo Century)
Singapore-based real estate and healthcare group OUE has formed a joint venture (JV) with Japanese financial services company Tokyo Century to acquire the 575-room Crowne Plaza Changi Airport from OUE Reit for $500 million — about 1.3% above valuation.
OUE and OUE Reit’s manager, the former’s subsidiary, announced the proposed transaction in bourse filings on June 25.
Located at Terminal 3 of Singapore Changi Airport and operated by IHG Hotels & Resorts and located, the hotel comprises a 332-room main building and a 243-room extension. It is directly connected to all airport terminals and Jewel Changi Airport via skytrain or a pedestrian link bridge.
For the Reit, the proposed divestment will allow it to unlock value from a mature hospitality asset ahead of the expiry of its hotel management agreement and master lease agreement in 2028.
This is "an opportune time" to crystallise the value of Crowne Plaza Changi Airport, said Han Khim Siew, chief executive of the Reit manager.
"It allows us to avoid substantial capital expenditure and income risks arising from operational downtime and transition uncertainty associated with potential asset repositioning works, which could otherwise have a negative impact on distributions to unitholders," he added.
Net cash proceeds for the Reit are estimated at $498.5 million, which it intends to use to repay debt.
Artist’s impression of a guestroom at the hotel. The acquisition will allow OUE to scale its recurring fee income streams. (Image: OUE, Tokyo Century)
Meanwhile, OUE and Tokyo Century said the deal reflects their confidence in Singapore’s tourism and aviation sectors, as well as Changi Airport. This is supported by the latter’s plans for expansion, including the development of Terminal 5, which is scheduled to open in the mid-2030s.
The JV partners aim to pursue potential asset enhancement initiatives (AEIs) for Crowne Plaza Changi Airport to drive continued revenue growth and asset performance, and in turn strengthen its long-term competitive positioning.
The AEIs are meant to enhance the overall guest experience and align the property with evolving traveller preferences and industry trends, both firms said in their joint announcement.
This will draw on OUE's track record in real estate development and asset management, alongside Tokyo Century’s experience in hotel development and operations in Japan, to realise the property's full potential, said Brian Riady, OUE deputy chief executive and executive director, in the announcement.
Yoichiro Nakai, deputy president and executive officer of Tokyo Century, described the property as a "highly strategic hospitality asset" that is connected to Changi Airport, "Singapore's gateway to the world".
The hotel acquisition is the second collaboration between the two firms. They had signed their first JV back in May 2025 to jointly develop the 255-room Hotel Indigo Changi Airport, at Changi Airport Terminal 2, which is slated to start operations in 2028.
With the Crowne Plaza transaction, if approved, OUE will be able to scale its recurring fee income streams through asset management and development management fees.
The Reit manager said that the price tag of $500 million is at a 1.3% premium to the average of two independent valuations as at May 1, 2026. Cushman & Wakefield VHS and Jones Lang LaSalle Property Consultants had valued the property at $492 million and $495 million respectively.
The proposed deal is subject to the approval of Changi Airport Group and OUE Reit unitholders.
Outdoor pool at Crowne Plaza Changi Airport. The JV partners aim to pursue AEIs to enhance guest experience and keep up with evolving traveller preferences and industry trends. (Image: OUE, Tokyo Century)
Post-divestment, OUE Reit’s portfolio will remain Singapore-centric, with about 94.3% of its assets under management located in the city-state.
The Reit's portfolio includes three CBD office assets in Singapore — OUE Bayfront, One Raffles Place and OUE Downtown Office — as well as two hotels, Hilton Singapore Orchard and Crowne Plaza Changi Airport, and the Mandarin Gallery mall in Orchard.
It recently redeployed capital from the 2024 sale of Lippo Plaza Shanghai, "an ageing short leasehold asset in a challenging market", into Sydney’s Salesforce Tower at 180 George Street, a new prime freehold asset with upside potential, Han said. OUE Reit took a 19.9% stake in Salesforce Tower this February.
As for OUE, it manages OUE Reit and the healthcare-focused First Reit.
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