Convivio acquires nine hotels in Europe for 620 million

Covivio Hotels has acquired eight luxury hotels in Europe for a total of 573 million euros and a Hilton in Dublin for 45.5 million euros in an operation that is expected to close during the first half of 2020.

These new transactions mark the continuation of Covivio’s European expansion in the main tourist destinations in Italy, the Czech Republic, Hungary and Ireland.

In five years Covivio has doubled its portfolio, with about thirty hotel brands spread across 12 countries in Europe.

This portfolio of high-end establishments in prime locations includes several iconic hotels such as the Palazzo Naiadi in Rome, the Carlo IV in Prague, the Plaza in Nice and the New York Palace in Budapest.

With this important transaction, which will be completed at the end of the first half of 2020, Covivio, already historically present in the office segment in Milan, is firmly established in the Italian hotel market.

Italy is the third world destination in number of overnight stays (429 million registered in 2018). It has a hotel real estate offer that is uneven and needs to be renewed, with a very weak penetration rate of the main brands (9.6% vs. 48% in France).

With a total of 1,115 rooms, these hotels will be operated under the NH Collection, NH Hotels and Anantara Hotels & Resorts brands. To do this, Covivio and NH Hotel Group have signed long-term lease agreements with guaranteed minimum equities.

The agreement has an initial duration of 15 years, expandable at the option of NH Hotel Group to 30 years. Covivio is now carrying out a capital investment program for the entire portfolio.

Started in 2014, the collaboration with NH Hotel Group began with the acquisition of a hotel in the center of Amsterdam and then continued between 2016 and 2018 with the purchase of ten hotels in Germany, the Netherlands and Spain.

HOTEL IN IRELAND

Covivio also announced the acquisition through a management contract for a four-star Hilton hotel located in the center of Dublin, for 45.5 million euros.

With 120 rooms, this hotel will benefit from a project to convert its meeting rooms into ten additional rooms from now until 2021, generating a value creation of almost 10%. This acquisition allows Covivio to establish itself in a new European market.

The company currently has a hotel portfolio of 6.9 billion euros within a total equity of 24 billion euros. The company is strengthening its high-end positioning strategy and geographic and operator diversification, started five years ago.