A record deal involving three prime hotels shows that despite recent political upheaval the hotel industry in Hong Kong is still an appealing prospect to international investors.

In the hotel industry’s biggest ever deal in Asia, one of Hong Kong’s most powerful property companies announced a joint venture with Abu Dhabi Investment Authority that values three of the territory’s hotels at $2.4 billion.

Under the deal announced last month, New World Development Company Limited, founded by tycoon Cheng Yu-tung, will sell 50% of its interest in Grand Hyatt Hong Kong, Renaissance Harbour View and Hyatt Regency Hong Kong. The hotels will be placed in a 50-50 joint venture to be formed by New World and the Abu Dhabi Investment Authority. This is the sovereign fund’s biggest Asian property investment and values each room at the three hotels at $1.4 million—a record in Asia.

“It’s a huge deal, which shouldn’t be too surprising given that these are prime Hong Kong real estate assets—especially the Grand Hyatt and Renaissance, which flank the Hong Kong Convention and Exhibition Centre, a key business generator for both hotels,” said Gary Bowerman, author of “The New Chinese Traveler: Business Opportunities from the Chinese Travel Revolution.”

ADIA, who declined to comment, has a long history of hotel ownership. Though it does not publicly disclose its holdings, in the past few years ADIA has acquired a collection of Edition hotels from Marriott International in 2014, 31 properties in Australia from Tourism Asset Holdings Limited in 2013, and 42 Marriott-branded hotels in the United Kingdom from the Royal Bank of Scotland in early 2013.

New World will get $1.3 billion in proceeds from the sale, which it will use to fund other property development projects in the territory, including the redevelopment of its New World Centre in Kowloon.

“The transaction offers the best of both worlds for NWD shareholders: We continue to retain a long-term interest in these prime hotel assets in Hong Kong whilst at the same time recycling capital to pursue other value enhancing investments,” said Adrian Cheng, NWD’s executive vice chairman, in a statement announcing the deal.

Hong Kong still attractive

The deal suggests Hong Kong remains an attractive option for overseas investors despite China’s economic slowdown, political protests and a plateauing of visitors from mainland China, who account for 75% of all arrivals in Hong Kong and 70% of all overnight stays, according to the Hong Kong Tourist Board.

“It proves that prime Hong Kong hotel assets do retain a strong global value despite recent publicity over Chinese visitor arrivals and room rate concerns,” Bowerman said.

Daniel J. Voellm, managing partner at HVS Asia/Pacific, shared a similar perspective.

“Hong Kong still has a strong draw as a destination, and there are lots of new infrastructure developments coming online soon, which can only help,” Voellm said.

These new projects include the expansion of the MTR system, better rail links to China and a bridge to Macau.

Voellm believes that barriers to entry in Hong Kong are high.

“It’s difficult for investors to enter the market,” he said. “Hotels are competing with office space. There are several examples of hotels being turned into office space. Hotels are often the second choice when it comes to real estate asset class.”

In April, luxury hotel operator Mandarin Oriental International announced it was planning to tear down its wholly owned subsidiary, the 4-star hotel The Excelsior, to make way for a commercial development.

Opportunities amid the slowdown

Hong Kong operators Magnificent Estates are looking for acquisitions as Chairman William Cheng Kai-man sees the fall in tourist numbers as an opportunity.

“Previously, owners were not interested to sell at all,” he said. “We absolutely will have more opportunities to buy than before,” he told the South China Morning Post. The company is looking to increase its hotel rooms in seven hotels from 2,300 to 3,000.

Data from STR Global, sister company of Hotel News Now, shows that while occupancy is down 4.7% during the first three months of the year to 83.2%, it still is among the highest of key markets in the Asia/Pacific region.

The same is true for Hong Kong’s revenue per available room, which at $1,442.36 Hong Kong dollars is the highest among all markets on a U.S. dollar basis at $186.02. (The metric is down 9.7% year to date in local currency.)

Several operators declined to comment on the slowdown in performance in Hong Kong.

With only a marginal increase in supply in the next couple of years, developers are likely to continue vying for the Hong Kong market with great interest.

Bowerman said more blockbuster deals could be on the way. “The presentation of the deal as a joint venture between New World and ADIA hints at more possible collaborations between two ambitious hotel owning groups,” he said.