Investors torpedo Hilton sale

Sunday 24 October 2004

Rising interest rates and a downturn of confidence in the property investment market has torpedoed a $51 million deal to sell Auckland's Hilton Hotel on Princes Wharf.

By The Landlord

David Henderson's Kitchener Group was to sell the hotel to an investment scheme marketed by Bayleys Real Estate and offered by St Laurence Group.

St Laurence investor services manager Jeanette Bullen said a turning property market had dented confidence.

"There's been a lot of talk about property flattening out and the market has changed as interest rates have started to go up," she said, adding that it was the funder's first failure.

This week's warnings from the Reserve Bank and FundSource against risky high-yielding property investments had not helped, she said.

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