London-based property investment firm Avignon Capital has acquired the NH Amsterdam Zuid hotel in the Dutch capital for €45 mln.
The deal marks Avignon Capital’s entry into the Dutch market and is its second hotel acquisition to date.
The NH Amsterdam Zuid hotel is based in the Zuidas business district of Amsterdam, between the city centre and Schiphol Airport. The 4-star hotel comprises 10,000 m2 and contains 213 guest rooms and 18 conference rooms. The property was originally constructed in 2002 and extensively refurbished as a hotel in 2008.
Market watchers say low interest rates, growing tourist numbers and the stable political climate in the Netherlands make Dutch hotels an attractive proposition for foreign property investors. Amsterdam’s tourist industry has expanded rapidly over the last decade, resulting in a rising demand for well-located hotels. Research carried out by Deloitte in Q4 2016 found that Amsterdam has taken over from London as the most attractive hotel investment destination in Europe. Between 2012 and 2016, the number of guests staying in Amsterdam’s hotels has risen from 5.5 to 7 million.
Avignon Capital has identified the Netherlands as a focus area within its European expansion strategy, where it sees multiple real estate investment opportunities across a variety of sectors. The Amsterdam hotel deal is the third in the Dutch market in the space of just over a week. In mid-April a group of Chinese investors bought the Holiday Inn in Leiden, which was followed shortly afterwards by the acquisition of the Nhow hotel development located next to the RAI congress centre in Amsterdam by AXA and Danish pension fund ATP.
Patrick Flaton, CFOO at Avignon Capital, said: ‘The acquisition of the NH Amsterdam Zuid hotel was a rare, off-market opportunity to acquire a prime hotel located in Amsterdam’s strongest business district.’ He added that the asset is securely let to a strong covenant for a further 42 years 'which offers a low risk, stable income base throughout the hold period'.
Avignon Capital was advised by Haagstate Advocaten on the legal side and Pierce Capital Investments for the deal.
