Avignon Capital makes first hotel acquisitions

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European property investment firm Avignon Capital has made its first hotel acquisition, paying €48.5m to buy two hotels in Berlin and Frankfurt let to operator Meininger, in an off-market transaction.

Eric Mounier, CEO at Avignon Capital said: “The booming German hotel industry presented us with an opportunity to diversify our portfolio whilst sticking to our philosophy of investing in attractive locations with strong growth fundamentals.”

The Berlin and Frankfurt Meininger hotels, next to transportation hubs, were built in 2010 and 2011, respectively.

The 296-room Berlin Meininger is on Washingtonplatz, near Berlin’s main station in the Europacity district, while the Frankfurt Meininger, which contains 168 rooms, is in Frankfurt’s Gateway Gardens. Avignon said the hotels’ proximity to Berlin and Frankfurt’s prime transportation hubs will be key to future value and growth.

The deal follows the sale of Avignon Capital’s Copenhagen prime retail portfolio for €119m in January, which provided investors with a 135% return on equity, as well as the sale of an office building in Oslo for €61m, generating an 87% return on equity. Avignon currently has a European property portfolio in five countries valued at €650m.

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