INTERNOS Global Investors (“INTERNOS”), the pan European owner-managed real estate fund management firm with €3.5 billion AUM, has closed the acquisition of the NH Turin Ambasciatori for €20m in a sale and leaseback transaction with NH Hotel Group, on behalf of the INTERNOS Hotel Real Estate Fund I (the “Fund”). This 4* Hotel provides 199 rooms, a restaurant, bar as well as twelve conference rooms and will be operated by NH Hotel Group under a long term hybrid lease containing fixed and variable rent components. INTERNOS will also invest €8.6 Million in the hotel’s refurbishment to enhance the quality, earnings and value of this property.
The Hotel’s strategic location, quality and potential of the building especially after the refurbishment, as well as the long lease and the strong international hotel operator make this hotel a perfect fit with the Fund’s strategy. Further from a portfolio perspective this 14th hotel acquisition of the Fund since its 1st Closing also fits perfectly with the Fund’s strategy for 2016 to reinvest capital released from successful disposals earlier in 2016 of the Ibis Hotel Munich City West and the Maritim Hotel Dresden for a total of €80m. With this investment the Fund will have ca. €400m of AUM. Since its 1st closing the Fund has distributed dividends of over 8% p.a. every year and achieved total returns of circa 12% p.a. Due to its predominantly fixed rents, long leases and fixed low interest rate financing the Fund should continue generating high annual income returns for the next few years.
Jochen Schäfer-Surén, partner in charge of managing the INTERNOS’ Hotel and Leisure division and the Fund, commented: “After the successful disposal of the two hotels earlier this year that allowed us to achieve IRR returns in excess of the Fund’s target returns, this 14th hotel acquisition allows us with the agreement of our investors to start the rotation of our capital from mature markets to other interesting markets with equally attractive running returns but more upside in the Eurozone.
“Today, we are actively pursuing further hotel core or core plus reinvestments in such new markets in the Euro-zone for our Internos Hotel Fund I or for our Hotel Value add Mandate in investments with a value add risk profile across all of Europe. Our remaining capital for hotel real estate across all of Europe is about €200m. Accordingly, we pursue further hotel acquisitions along the entire risk spectrum, which highlights how institutional investors explore new avenues for alternative investments in the current very low interest rate context allowing us to cover the entire hotel real estate investment range across Europe as long as the risk return profile remains attractive.”
