The hotels are of very high quality, positioned in the upper full-service segment and operated by well-known hotel operators under long-term revenue-based lease agreements with good rental guarantee levels. The acquisition is fully financed by a new bank loan and existing credit facilities. The acquired portfolio is expected to contribute the equivalent of approximately MSEK 140 in cash earnings 2017.
“The acquisition fulfills all Pandox’s strategic criteria regarding size, location, market position and profitability, as well as contributes to a further diversification of our revenue base. The hotel properties are of very high quality, are operated by well-known hotel operators under long-term revenue-based lease agreements and will give a substantial revenue contribution to Pandox’s already strong lease portfolio. Through the acquisition Pandox enters two new hotel markets and four new interesting hotel cities. We strengthen our presence in Germany, which is the largest hotel market in Europe, and add two new strong operators to our cooperation portfolio. With this acquisition we also demonstrate that there is substantial potential for Pandox to grow its core business with good profitability on the major hotel markets in Europe”, says Anders Nissen, CEO of Pandox.
The acquisition price amounts to EUR 415M, corresponding to approximately SEK 4.1 billion at current exchange rate, on a debt free basis including non-controlling interest related to the four German hotel properties, and after deduction of deferred tax. The acquisition is financed by a new five year bank loan with Aareal Bank amounting to approximately EUR 270M and other existing credit facilities.
The acquired hotel property portfolio comprises seven hotels with 1,744 rooms. The hotels are marketed under the brands NH, Radisson Blu and Park Hotel Amsterdam. The hotels are positioned in the stable and profitable upper full-service segment and are located in international cities (Vienna, Munich, Amsterdam, Frankfurt and Hamburg) with a high share of international demand, and regional cities (Cologne and Salzburg) with a high share of regional demand, which in total create a well-balanced demand mix. The hotels have strong locations for both the business and leisure segment. They benefit from a dynamic event market and the fact that the cities are also attractive leisure destinations.
The seller is Invesco Real Estate via its European Hotel Real Estate Fund II. Pandox AB completes the acquisition of the four hotel properties in Germany together with Eiendomsspar AS as minority shareholder with 5.1 percent. This structure is considered the most efficient solution for all shareholders in Pandox.
Pandox Acquires Major Hotel Portfolio in Europe
Sweden — Pandox has entered into an agreement with Invesco Real Estate to acquire seven hotel properties in Europe – four in Germany, two in Austria and one in the Netherlands – with a total of 1,744 rooms. The acquisition price amounts to EUR 415M, corresponding to approximately SEK 4.1 billion, on a debt free basis.