INTERNOS Global Investors following its recent acquisition of Commerz Real’s real estate Spezialfonds business (CRS), announces the closing of the acquisition of the NH Düsseldorf City Nord hotel from the European Real Estate Investment Trust (EREIT), for a purchase price of €37.5 million and yield of 7.8% on behalf of the INTERNOS Hotel Real Estate Fund I (INTERNOS Hotel Fund I). This is the eighth hotel the Fund has acquired since its first closing in July 2012.
The property, operated under a long lease by NH Hotels with 15 years unexpired lease term, is an existing, high quality, 4* hotel comprising 330 rooms with a strong cash flow track record and strategic location in northern Düsseldorf. The hotel’s profile and strategic location fit perfectly with the Fund’s investment strategy and brings it further diversification by adding a new hotel brand and tenant and a further city into its portfolio.
Following this eighth acquisition, gross assets under management for the INTERNOS Hotel Fund I have reached in excess of €235 million. The Fund is poised to continue to generate income returns in excess of 7.5% dividend p.a. for the next few years, due to its growing hotel portfolio with a strong cash flow track record, long leases with mostly [fixed] indexed rent and very attractive low interest rate financing fixed for five years.
Jochen Schäfer-Suren, Partner and Head of INTERNOS’ Hotel and Leisure division, commented: “We have now deployed two thirds of the capital subscribed by our investors in 15 months since the fund’s launch, whilst adhering to the fund’s investment strategy and exceeding the fund’s target returns. We have 2 or3 more acquisitions in the pipeline over the coming months and thus expect to deploy the remaining equity of the Fund and reach an estimated AUM of close to €400 million by mid-2014. During 2014, we expect to launch a successor fund to this first fund focused on income and core investment strategy in the specialist hotel real estate asset class across Europe.”