US private equity firm Apollo Global Management is on the brink of acquiring a pan-European hotel portfolio from Canadian property group Ivanhoe Cambridge for €425 mln, according to those who track the market.

US private equity firm Apollo Global Management is on the brink of acquiring a pan-European hotel portfolio from Canadian property group Ivanhoe Cambridge for €425 mln, according to those who track the market.

The deal, which is believed to have been agreed, but has not yet closed, comprises 18 hotels in the InterContinental Hotels Group including 13 hotels in Germany and one in Paris, as well as hotels in Spain and the Netherlands. Hotels in the portfolio include Holiday Inn and Holiday Inn Express hotels in Munich, Berlin and Frankfurt. Apollo and Ivanhoe Cambridge could not be reached for comment.

‘This is a significant transaction and marks a good start to the year,’ Frédéric Le Fichoux, head of Cushman & Wakefield Hospitality for the CEE region, told PropertyEU. ‘I think we’ll see more deals like this going forward.’ Cushman & Wakefield did not advise on the deal.

Apollo has been on a big investment drive in recent months. In December, it acquired a portfolio of non-performing Irish retail mortgage loans from Lloyds Banking Group for £275 mln. In the same month, the private equity firm also acquired a portfolio of enforced legacy property loans, known as ‘Project Moon’, from insurer Aviva for £400 mln. US private equity groups Blackstone and Cerberus are also believed to have submitted bids.

Investors are also diversifying when it comes to acquiring hotels, according to Le Fichoux. ‘Last year, investors typically targeted gateway cities in Western Europe but this is now changing,’ he said. ‘I expect the deal volume to increase this year as investors diversify and target secondary locations and become more diverse in their remit.'