Warimpex prepares expansion drive - do not use yet

CEE hotel developer- investor Warimpex has positioned itself to acquire land plots and properties at bargain prices in the current downturn for future expansion.

The Vienna and Warsaw-listed firm raised €8.1 mln in a capital raising aimed at new investors on 23 October. Although the equity raised was modest compared to some of the capital raising exercises by real estate companies in the UK and in Western Europe this year, Warimpex said the proceeds will allow it to act quickly ‘when the need or opportunity arises’.

In an interview with PropertyEU, Warimpex CEO Franz Jurkowitsch said pricing of properties in good locations in Central and Eastern Europe has come back to reasonable levels in the last 12 months after a prolonged period of highs.

Commenting on the general market conditions, Jurkowitsch said hotels are generally one of the first segments to suffer in a downturn and the first to recover. He said he could see a basis for stabilisation in several markets, while Prague and Bucharest remained the weakest performers.

At the same time many property owners are in financial distress. Warimpex wants to take this opportunity to acquire land or properties. It is buying five plots of land and has an option to buy five more. (where?). future purchases could include half-finished hotel projects in a price range of €4-5 mln.

Warimpex, Jurkowitsch said, similarly took advantage of the previous market downturn earlier this decade to expand. ‘Investment in difficult times is always better than those carried out at high noon,’ he added.

The main goal of the current acquisition drive is to expand the number of three-star budget hotels under the Campanile and Premiere Classe brand. The firm is also looking to develop more four-star angelo (and andel?) hotels.

Warimpex sold its Andel’s hotel in the Polish city of Krakow in early September to Germany's Deka Immobilien. Although the financial details were not disclosed, Jurkowitsch said, 'The sale brought us an excellent yield under the current market conditions, generated a net gain.'