Sweden based hotel property owner Pandox have closed the acquisition of 18 hotel properties in Germany for a final transaction price €400m, consolidating the company’s position in what is one of their priority markets.
The acquisition is expected to increase Pandox’s rental revenues by over €27m (SEK250m) and cash earnings to approximately €16.23 (SEK150m) in 2016. Fattal Hotels – one of the sellers along with Leopard Group - will remain a long-term lessee in all of the hotel properties with new 25-year revenue-based lease agreements.
The portfolio consists of 18 hotels with 3,415 rooms across 12 German cities. The hotels will be marketed under the brand name Leonardo Hotels and are positioned in international cities such as Frankfurt, Düsseldorf and Hamburg with a high share of international demand, and regional cities, such as Cologne, Hannover and Mönchengladbach with a high share of regional demand, which in total create a well-balanced demand mix.
Commenting at the time the transaction was agreed, Anders Nissen, CEO of Pandox, said: “The acquisition fulfils all Pandox’s strategic criteria as regards size, city, location, market position and profitability, and strengthens our position on the important German market. The transaction is also completely in line with Pandox’s business model, which is based on long-term lease agreements. Furthermore, Fattal Hotels is a new strong long-term partner and the hotels have good development potential.”
Pandox’s hotel property portfolio currently comprises 121 hotels with more than 25,000 hotel rooms across eight countries. Pandox’s business is organised into property management, which comprises hotel properties leased on a long-term basis to market leading regional hotel operators and leading international hotel operators, and pperator activities, which comprises hotel operations executed by Pandox in its owner-occupied hotel properties.
