Pakistan Hotels Developers Ltd (PHDL), the owner of the Regent Plaza hotel, located on Karachi’s main thoroughfare, revealed on Wednesday that it has received a lucrative offer to sell its property for a staggering Rs14.5 billion. The offer was presented by the Sindh Institute of Urology and Transplantation (SIUT) Trust, a renowned non-profit organization in the healthcare sector. This formal proposal comes after PHDL previously disclosed that the SIUT Trust had expressed interest in conducting due diligence on the property, a comprehensive assessment of assets and liabilities.
The potential acquisition of the Regent Plaza hotel property by the SIUT Trust is believed to be aimed at transforming it into a healthcare facility. It’s important to note that the SIUT Trust is interested in acquiring the property itself, not the entire company, PHDL. As a result, the proceeds from this transaction will be directed to the company, which will retain its listed status, albeit without the primary revenue-generating hotel property.
The Regent Plaza Hotel and Convention Centre, situated on Karachi’s Shahrah-i-Faisal, occupies an area of 13,200 square-yards, with a total covered area of 47,034 square-yards. Additionally, PHDL owns two other real estate assets in Thatta, totaling approximately 14 acres. It remains unclear whether the proposed transaction encompasses these Thatta properties.
The hotel boasts 400 rooms but has experienced a moderate occupancy rate of 19% for the 2022-23 fiscal year, with occupancy rates of 20% and 9% in the preceding two years. According to the latest annual accounts, the company has assessed the value of its primary real estate at Rs8.9 billion, with the hotel building valued at Rs924.2 million.
For the 2022-23 fiscal year, PHDL reported a net profit of Rs44.1 million, representing a 7.7% decline from the previous year.
Notably, the share price of PHDL exhibited a significant increase, rising by 7.5% and reaching Rs458.41 at the close of the trading session on Wednesday. This remarkable price surge, nearly a 500% increase since the end of August, drew attention from regulatory authorities due to its unusual movement in the days leading up to the initial expression of interest by the SIUT Trust.
The Sindh Institute of Urology and Transplantation (SIUT) has a remarkable history, originating as an eight-bed ward in the Burns Unit of Karachi’s Civil Hospital four decades ago. Since then, it has undergone significant expansion and currently operates as a charitable trust, providing medical services and financial aid to over half a million patients annually across multiple hospitals.