Ott Ventures has launched its first hotel fund to take advantage of weak competition and a possible long-term growth prospects of the European hospitality sector post the coronavirus pandemic.

The manager has launched the Velvet hotel fund, which with 50% loan-to-value, to invest and manage €500m worth of properties across Europe with a focus on the main Central European markets being Poland, Czech Republic and Hungary as well as in Germany and Austria.

The fund has already identified several opportunities for its seed portfolio, Ott Ventures said without disclosing further details.

The Velvet hotel fund will invest in properties from budget to trophy assets, in city-centre locations, both in existing properties and developments.

Jean-François Ott, founder and CEO at Ott Ventures said: “In a momentum of weak competition with few new products, alongside an expected increase in regional ADRs we believe it is the best time for us to launch our first hotel fund.”

Ott said the current market conditions will allow the fund to have access to attractive investment opportunities by bringing much “needed equity or hybrid equity to investors or operators facing cash flow challenges”.

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