Hamburg-based fund management company DIFA Deutsche Immobilien Fonds AG has completed a further hotel transaction in the high-end business segment by acquiring the Le Meridien in Stuttgart.
Amounting to some 32 million euros, the investment was made on behalf of the DIFA Immo-Invest fund, which is targeted at institutional investors and aims to deliver high distributions combined with low investment risk. The hotel is let to operator Meridien Hotels GmbH (Germany) on a long-term lease. "For us, hotels represent a good opportunity for portfolio diversification and an attractive investment due to the long leases and ability to team up with leading international operators like Meridien," says Ingo Hartlief, the DIFA board member whose responsibilities include institutional funds, lettings and portfolio management. DIFA purchased Le Meridien from Aachen-based insurance company AMV, while Klein & Associates Immobilienberatung GmbH provided consultancy services on the transaction.
DIFA strategically positioned as hotel investor In Stuttgart itself, DIFA already owns a Dorint Sofitel hotel near the main rail station, as well as the MÃ¶venpick Hotel Stuttgart Airport. The DIFA portfolio now includes more than 20 hotel properties in locations such as Berlin, Hamburg, Munich, Brussels and Paris, corresponding to approximately 9 per cent of total holdings across all funds. DIFA works with leading operators like Hilton, Steigenberger, Marriott, Dorint, InterContinental and Radisson SAS, investing in high-end business hotels that benefit from prime urban locations in both German and international cities. "Hotels continue to be a focus of investment activity for DIFA," adds Hartlief.
Le Meridien enjoys good city centre location
The Le Meridien on Stuttgart's Willy-Brandt-StraÃe is a four-star-plus hotel with 281 rooms, including 35 suites, as well as an area of 1,229 square metres set aside for meetings, conferences and events. Originally built in 1987/88, the hotel was modernised in 2004 and features a wellness/spa area, bar and restaurant, along with 184 parking spaces. The hotel is situated in a good central location to the northeast of Stuttgart's Old Town, adjoining the eastern fringe of the Schlossgarten park near the city's planetarium. The main rail station and city centre are both just a few minutes' walk away, with many of Stuttgart’s tourist sights also within easy reach.
Positive outlook for Stuttgart hotel market
According to a study by the Office of Statistics, capacity utilisation in the Stuttgart hotel market is average for German cities with over 400,000 inhabitants. The new trade show site and new attractions such as the Mercedes-Benz and Porsche museums, an art gallery and changes to the city's main squares and thoroughfares, as well as the 2006 FIFA World Cup, will all boost the attractiveness of Stuttgart over the next few years. This growth is expected to be of a sustained nature, with the number of overnight stays in the city set to increase considerably over the medium term.
Stuttgart - a dynamic business location
Stuttgart is the main commercial centre for the state of Baden-WÃ¼rttenberg, with the automotive, software and computer industries predominating. Due to its concentration of high-tech activities, the
Stuttgart region is one of Europe's most attractive business locations and enjoys international importance. Key industries include machinery, electronics, vehicle manufacturing, IT, plus media and publishing. In addition to being home to world-famous companies such as AlcatelSEL, Bosch, DaimlerChrysler, debis, Hewlett-Packard, IBM and Porsche, the Stuttgart area is noted for innovative mid-sized businesses, many of which are leading international players in their field. With a total of some 150,000 businesses, the region is the economic powerhouse of southwest Germany and beyond. This healthy mix of large, small and mid-sized firms is one of the secrets behind the region's success. New facilities for trade shows are currently under construction near the a