Capman Hotels RE fund closes at EUR 872m

Finnish asset manager Capman has announced that fundraising for the Capman Hotels RE fund has been finalised.

Capman said that the fund has an investment capacity of EUR 872.5 mln. The fund invests in both existing hotel properties and new hotel development projects, primarily in Finland and Sweden.

Capman Hotels RE fund acquired a portfolio of 39 hotel properties when it was established in January 2008 and it still has two-and-a-half years to make new investments or add-on investments.

'We develop the hotel properties in cooperation with tenants. The most significant development projects this year have targeted Cumulus Airport Hotel near Helsinki-Vantaa Airport and Rantasipi Laajavuori Hotel in Jyväskylä,' said Pirjo Ojanperä, head of Capman's real estate hotel fund.

'The fundraising market has changed considerably since the establishment of the hotel fund. We are pleased with the final closing of the hotel fund in this situation,' added senior partner Jerome Bouix, head of Investor Services.

A total of 21 institutions, mainly from Finland, have committed EUR 332.5 mln of equity to the fund, with the balance comprising senior debt. Capman Hotels RE, which is 80% owned by the Capman Group, acts as the fund's management company. The management company's own commitment into the fund is EUR 5 mln.

The management fee for the fund is based on acquisition cost of the current portfolio including executed add-on investments. The fund will begin to generate carried interest when investors have regained their investment and a preferred annual return of 8%, after which the division of cash flows will be 80% for investors, 12% for Capman (carried interest) and 8% for the fund's investment team.