EU: L+R Hotels and pension fund manager PGGM have joined forces to back a €1 billion investment venture targeting European hotels.
The partnership will be led by CEO John Ozinga and CIO Henri Wilmes. Ozinga is the former CEO of AccorInvest and Wilmes joins from A&O Hostels.
L+R and PGGM will contribute €500 million of equity and €500 million of debt to target properties in France, Germany, Benelux, Spain and Italy. Transactions will be carried out by a newly formed asset management company LRO Hospitality.
Ozinga, founder and CEO of LRO Hospitality said: “Current market conditions will present LRO Hospitality with attractive investment opportunities to acquire from investors or operators facing cash flow challenges. Given the expected short to mid-term post-pandemic recovery, we believe it is the best time for us to launch our first hotel venture.”
Desmond Taljaard, managing director of L+R Hotels, said: “We are pleased to enter into this venture with PGGM as we believe in the resilience of the hotel market and its recovery in the future. The commitment of PGGM shows their confidence in our ability as deal sourcer, hotel operator and asset manager to create value, and their appetite for the European hospitality sector as an institutional asset class, despite the negative short-term impact of the COVID crisis.”
Tinka Kleine, senior director of private real estate for PGGM, said: “We have added hotels to our city focused investment programme because it offers attractive investment opportunities, both for achieving financial returns and for improving the sustainability performance of well-located assets. The strong track record of L+R Hotels and the LRO team in securing and executing such strategy provides a perfect base for a successful partnership.”
The first two deals are set to be announced in February including a hotel near La Défense on the edge of Paris, according to The Times.
L+R Hotels has a portfolio of more than 100 properties across Europe, USA and the Caribbean comprising over 21,000 keys. Hotels include Clivedon House in Berkshire, Nobu Hotel London Portman Square, and the Fairmont Monte Carlo.
Around 90 per cent of L+R’s portfolio is directly operated by the group. Brand partners include Hilton, Marriott, IHG and Accor.
PGGM is a not-for-profit pension fund provider. On 31 December 2021, the company managed €291 billion worldwide.
