New Zealand-based investment firm Carter Group has become a ”significant stakeholder” in a A$500m (€317m) distressed Asia-Pacific hotel fund managed by Pro-invest.

Carter Group has also sold the Flinders Lane hotel in southeastern Australia to the Pro-Invest Fund III fund, which plans to spend A$20m to renovate the 209-room hotel in central Melbourne and rebrand it as Hotel Indigo Melbourne, an IHG Hotels & Resorts operated hotel.

Philip Carter, managing director of the Carter Group, said: ”Joining the fund was a strategic decision by the group to move from holding a single hotel asset in Australia to having exposure to opportunities in Asia-Pacific.

“The purchase, upgrade and repositioning of the hotel will continue to increase asset value for the (hotel) fund over the coming three to five years. Ultimately, this long-term view is why we’re also investing with Pro-invest.”

Jan Smits, CEO Asia-Pacific of Pro-Invest Group, said the $20m repositioning of the Hotel Indigo lifestyle brand will result in even “greater asset value being realised – to the benefit of guests, the community and investors”.

“We deliver superior, sustainable returns across our funds by focusing on the whole lifecycle – from acquisition through to development and operational excellence, while maximising our proven commitment and capability in ESG.”

The Flinders Lane acquisition is the second for the Pro-Invest Fund III, which is focused on hotel opportunities in gateway cities across Australia and broader Asia Pacific. Last May, Pro-Invest acquired the Sebel Canberra Campbell for around A$48m.

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