Key points
- The long-running financial and ownership saga surrounding Bangkok’s Royal Orchid Sheraton Riverside Hotel has entered another important phase, with GROREIT awaiting a decision from Government Savings Bank over the extension of THB 1.
- 35 billion loan when it matured on July 14 resulted in the Stock Exchange of Thailand placing a CB, or Caution-Business, designation on GROREIT units.
- At the center of the problem is ROH’s failure to provide the funds required to repurchase the Royal Orchid Sheraton Hotel &.
The long-running financial and ownership saga surrounding Bangkok’s Royal Orchid Sheraton Riverside Hotel has entered another important phase, with GROREIT awaiting a decision from Government Savings Bank over the extension of THB 1.35 billion in outstanding debt. At the same time, the trust’s management is consulting regulators over what happens next to one of Bangkok’s best-known riverside hotel properties.
Image Credit: Thailand Hotel News
The latest developments follow the failure of Royal Orchid Hotel (Thailand) Co., Ltd. (ROH) to complete the agreed repurchase of the Royal Orchid Sheraton property by July 14, 2026. The missed deadline had immediate consequences for the trust because, as this Thailand Hotel News report explains, GROREIT had expected proceeds from the repurchase to help repay its THB 1.35 billion loan from Government Savings Bank.
Government Savings Bank Decision Now Crucial
GROREIT’s REIT manager has requested an extension of the repayment period and waivers relating to certain loan conditions. The application remains under consideration by Government Savings Bank, with a decision expected in the near future.
The inability to repay the THB 1.35 billion loan when it matured on July 14 resulted in the Stock Exchange of Thailand placing a CB, or Caution-Business, designation on GROREIT units.
Management has indicated that the proposed extension should not interfere with GROREIT’s continuing operations. Importantly, the trust is reported to have sufficient liquidity available to meet approximately one year of interest payments, providing some breathing room while discussions with the bank and regulators continue.
Missed THB 4.873 Billion Hotel Buy-Back
At the center of the problem is ROH’s failure to provide the funds required to repurchase the Royal Orchid Sheraton Hotel & Towers under the existing buy-back arrangement.
The contractual repurchase value was THB 4.873 billion, but when ROH did not complete the transaction by the July deadline, GROREIT was left without the anticipated cash needed to settle its Government Savings Bank obligation.
The situation has subsequently forced the REIT manager and trustee to consider alternative courses of action while attempting to protect the interests of GROREIT unitholders.
Royal Orchid Sheraton Gets Higher Valuation
One significant development is a fresh appraisal of the Royal Orchid Sheraton property following the expiration of the buy-back deadline.
Without the previous buy-back condition attached, the Bangkok riverside hotel has now been appraised at THB 5.212 billion. The updated valuation was disclosed to the Stock Exchange of Thailand on August 28.
That figure is THB 339 million higher than the THB 4.873 billion contractual repurchase value, representing an increase of approximately 7 percent.
The higher appraisal could become particularly significant if the property ultimately has to be offered to other investors rather than being returned to ROH under the original arrangement.
SEC Discussions and Possible Hotel Auction
The REIT manager and MFC Asset Management, acting as GROREIT’s trustee, are also consulting Thailand’s Securities and Exchange Commission over the appropriate steps following the missed repurchase deadline.
Further details have not yet been disclosed while those discussions continue. Management has emphasized that decisions will be made with the interests of GROREIT unitholders in mind and that material developments will be reported through the Stock Exchange of Thailand.
Meanwhile, preparations are reportedly being made for the Royal Orchid Sheraton property to potentially be offered to interested buyers through an auction process.
Such a sale could open another chapter in the complicated history surrounding the landmark Bangkok hotel, particularly given its new THB 5.212 billion valuation.
ROH Still Wants the Property Back
Despite missing the July 14 deadline, ROH has reportedly maintained that it still intends to exercise its repurchase rights. The company says it has support from a financial partner, with due diligence being conducted as part of efforts to move forward.
That leaves several possible outcomes still on the table: an extension that provides more time to resolve the debt, a renewed attempt by ROH to secure the hotel, or an eventual sale of the asset to another buyer.
For Thailand’s hotel investment community and GROREIT unitholders, the coming decisions from Government Savings Bank, the SEC and the parties involved will therefore be closely watched. The Royal Orchid Sheraton remains a valuable Bangkok hospitality asset, but the unresolved financing, expired buy-back deadline and possibility of an auction mean the saga is far from finished. Whether ROH can ultimately regain control or a new investor emerges could determine the next chapter for this prominent riverside property.
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