French hotel group Accor has sold 47 hotels in France and 10 in Switzerland to a consortium including Caisse des Depots et Consignations and AXA REIM for EUR 518 mln. The Novotel, Mercure, Ibis, All Seasons and Etap Hotel properties involved in the transaction have a total of 8,200 rooms.
French hotel group Accor has sold 47 hotels in France and 10 in Switzerland to a consortium including Caisse des Depots et Consignations and AXA REIM for EUR 518 mln. The Novotel, Mercure, Ibis, All Seasons and Etap Hotel properties involved in the transaction have a total of 8,200 rooms.
The deal is part of a EUR 1.9 bn asset disposal programme presented by Accor in September. It includes a EUR 52 mln renovation programme at the new owner's expense as well as extensions to two of the properties costing a total EUR 30 mln.
Accor will continue to operate the hotels under the same brands through 12-year variable leases, whose rents are based on an average 16% of revenue a year with no guaranteed minimum. The leases are renewable six times, for a total of 84 years. Based on estimated 2007 revenue, the variable rent would amount to EUR 29.6 mln (excluding EUR 3.7 mln in insurance costs, property taxes and structural maintenance costs).
AXA REIM is buying the assets through its European Hotel Venture and Alternative Property Income Venture funds. In total, the real estate investment firm has some EUR 42 bn in assets under management.
