Mainland conglomerate HNA Group is investing more than $137 million to acquire 10 Seattle area golf courses, according to a statement filed yesterday with the Hong Kong stock exchange. The acquisition adds to an October total of nearly $11 billion in investments by the parent company of China’s Hainan Airlines, including deals in aircraft leasing, tech outsourcing and now sports facilities.

HNA is purchasing the portfolio of golf courses, which cover a total of 1,880 acres (760 hectares) and 180 holes, from Seattle-based Oki Golf through its Hong Kong-based subsidiary HNA Holdings. The Chinese company’s board explained in its statement that an upswing in golf tourism among wealthy Chinese, as well as on the growth of the Seattle area made the deal appealing and potentially profitable.
 

The acquisition is the latest in a string of cross-border property purchases by HNA which is quickly becoming one of China’s leading global investors with international holdings in transportation, real estate and technology.

 

 

Under the terms of the agreement signed between HNA and Oki Golf, the Chinese company will pay annual rent of $7.1 million for the next five years to the golf firm owned by former Microsoft executive Scott Oki, in return for the company continuing to manage the ten facilities over the period.

 

Much of the impetus for the investment by HNA seems to be its faith in the riches to be gained from the growing number of Chinese travellers. “In view of the development of outbound tourism from the PRC in recent years, the Directors are of the view that the prospects of recreational and tourism activities (in particular, golf tourism) in the global market are promising mainly due to the continuing growth in the number of high-net-worth outbound tourists, the increasing trend of pursuit of healthy lifestyles, the rising demand for leisure and social activities, and the increase in the expenditure of the outbound tourists from the PRC,” HNA executive director Xu Haohao said in a statement.

 

 

According to industry figures, 120 million Chinese travelled overseas in 2015 up by 12 percent over the previous year, and they spent some $104.5 billion – an increase of 16 percent from 2014. HNA’s belief in the riches to be squeezed from Chinese travellers was also evident in a hotel acquisition by HNA in April, when the company paid an undisclosed sum to buy Carlson Hotels, owner of the Radisson and Country Inns & Suites chains as well as of Europe’s Rezidor Hotel Group.

 

 

While golf continues to be a highly sought-after symbol of elite status in China, the sport has been on the decline in the US during recent years. As recently as 2006, 30 million Americans described themselves as golfers, but that number has since declined to around 25 million, according to the Economist. The number of golf courses is also heading south, with 160 of Americas 14,600 golf courses closing in 2013.

Despite the apparent downturn, HNA remained optimistic, with Xu explaining in the statement that, “The Directors are of the view that Seattle will be an excellent gateway to tap into the North America (especially the US) golf tourism market, which has good long term prospects and development potentials in the foreseeable future.”

 

 

The acquisition from Oki Golf comes just days after HNA’s Avolon Holdings subsidiary agreed to buy the aircraft leasing business of New York’s CIT Group for $10 billion, in a deal which Bloomberg reported would put the Chinese airline in charge of the world’s third-largest rental air fleet.

Also this month, HNA EcoTech agreed to buy Pactera Technology International, a China-based IT outsourcing firm from Blackstone for around $675 million in cash, according to a report in the Wall Street Journal.

In April the Chinese group closed on the ₤131 million (then $189 million) acquisition of 30 South Colonnade, an office building on London’s Canary Wharf, which is best known for serving as the headquarters for Reuters News Agency.

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