Union Investment “Slims Down” Hotel Portfolio with Sale of Hamburg Marriott

Posted on 3 September, 2015 by Cliff Goodwin

The global investment and property developer, UK & European Investments, has returned to the Hamburg leisure market with the acquisition of a Marriott hotel in the German city.

Union Investment Slims Down Hotel Portfolio with Sale of Hamburg Marriott

The London-headquartered company paid Union Investment (UI) €65m (£47.4m) for the luxury hotel close to Hamburg’s prestigious Jungfernstieg Boulevard. The property, which has 270 rooms, eight suites and four fully let retail units, was originally acquired by UI a decade ago for its open-ended real estate fund Unilmmo: Deutschland.

Commenting on the disposal, Dr Frank Billand, a member of the management team at Union Investment Real Estate GmbH, said: “This sale sees us leveraging the current market environment to drive forward the optimisation of our fund portfolio, as well as reducing its average age.”

He added that his company would continue to “make targeted acquisitions in major European cities in 2015 to expand our hotel portfolio”.

Union Investment — one of Europe’s largest hotel investors — still has six assets in the north German port city, including the Motel One close to the Reeperbahn on Ludwig-Erhard-StraBe, the five-star Steigenberger Hotel on Fleetinsel, and the Scandic Hamburg Emporio.

It currently has a pan-European hotel portfolio of 39 assets worth around €2.3bn (£167.8bn), the majority on long-term leases to international operators such as Motel One, Hilton, Marriott, Rezidor and Steigenberger.

In 2012 UK & European Investments purchased Hamburg’s Intercontinental Hotel from Kuhne Immobilien. “We are delighted to be back in the city,” said Adam Golebiowski, the firm’s European acquisitions director. “We see Hamburg as one of the most attractive real estate investment markets in Europe with high liquidity and strong economic fundamentals.”

“The Marriott Hamburg is a rarely available property in an outstanding location, combining a strong income yield with significant asset management opportunities in the long term,” he added. “The hotel is one of the best performing in Hamburg and has been consistently throughout the last cycles.”

The Marriott deal follows UK & European Investments’ joint venture purchase of a 215,000 sq ft office building in Paris in January with Red Tree Capital, and the acquisition of a Madrid residential asset in June, with ongoing permission to build an extra 60,000 sq ft of apartment space.

Union Investment was advised on the Hanover transaction by Clifford Chance and CBRE Hotels.




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