Partners Group, Singaporean sovereign wealth fund GIC and Salter Brothers have partnered to buy a A$620m (€388.6m) portfolio of eleven Travelodge hotels in Australia.

Partners Group, investing on behalf of its clients, said the portfolio is being acquired from Australian property group Mirvac and NRMA.

The assets, located in Sydney, Melbourne and Brisbane, consists of over 2,000 rooms.

Partners Group said the deal, which is the largest of its kind to transact in Australia, will provide an opportunity to capitalise on the long-term relative value of Australia’s hospitality sector.

The new owners intend to reposition the portfolio via initiatives like rebranding and select upscaling

Rahul Ghai, private real estate managing director at Partners Group, said: “Given our relative value approach, we have been monitoring Australia’s hospitality sector over the last year for value-add opportunities created by the fall-out from COVID-19.

“This portfolio represents an excellent opportunity to acquire well-located assets and gain immediate scale in the sector at a discount to pre-pandemic prices.

“We particularly like this portfolio as it provides initial income with potential for further yield through transformational value creation strategies. It also provides a significant foothold from which we can scale towards a larger portfolio over time.”

Euan Kennedy, a member of management, private real estate, Partners Group, said: “Although international travel remains restricted, there is some evidence of a steady economic recovery in Australia.

“Rising rates of vaccination are likely to support the progressive reopening of the economy and bode well for increased room penetration from both domestic and foreign travellers over the course of our investment.

The portfolio represents Partners Group’s third direct real estate investment in Asia so far this year. Partners Group’s Real Estate business has $17bn in assets under management and has invested $22bn since inception.

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