Swiss Life REIM (France) has lifted assets under management by its second hotel fund to over €300 mln following the acquisition of three assets in Paris.

Swiss Life REIM (France) has lifted assets under management by its second hotel fund to over €300 mln following the acquisition of three assets in Paris.

The 4-star hotels are Best Western Premier Opéra Faubourg, Holiday Inn Paris Gare de l’Est and Hotel Beauchamps, very close to the Champs Elysées. Providing a total of 400 rooms, the hotels were either recently renovated or under renovation.

They were acquired from a partnership of Morgan Stanley Real Estate Investing (MSREI) and Paris Inn Group for an undisclosed price. Paris Inn Group will continue to manage the hotels on a 12-year lease contract.

This was the second acquisition in December carried out by Swiss Life REIM (France) on behalf of its fund that focuses on boutique hotels in Paris and Nice. 'Our upscale hotel fund has now more than €300 mln under management and investment round continues as investors express interest. We believe that this segment offers real value creation potential,' said Johanna Capoani, senior fund manager at Swiss Life REIM (France).

Long-term investor
Built around the former Paris-based Viveris business, Swiss Life REIM (France) pitched its first hotel fund at the budget segment around France. Its second hotel fund has moved up a notch to focus at mid-sized but high-end, boutique-style assets in Paris and Nice to provide ‘an attractive yield premium while limiting operational risk’. The first acquisition involved seven 3 to 4-star hotels in Paris and Nice.

‘We are not targeting really big, major hotels in excess of 250 rooms or operating under major brands,’ Capoani said. The hotels will be mainly accessed off-market and the bricks-and-mortar plus the operating business will be acquired, with a management lease applied. The upside will come from value-add measures: two hotels in Paris have already been completely renovated while the rest will undergo upgrading by 2017. The fund is a long-term investor and will hold assets for around 10 years, Capoani said.
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Hotel special
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PropertyEU's December 2015 edition features a special report on the European hotel investment sector.

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