Le mie ricette per la real estate communityCovivio announces that it has signed a memorandum of understanding with AccorInvest to consolidate the ownership of jointly owned hotel operating and property companies, in accordance with the terms defined at the start of exclusive negotiations in November 2023.
The transaction is expected to close in the final quarter of 2024. “Today marks another important step in our partnership with AccorInvest. The agreement will contribute to Covivio’s development in the hotel sector and gives us the opportunity to draw on the full range of our real estate and hotel expertise. By repositioning a large part of the portfolio, we intend to strengthen our ability to act directly on its performance, thereby leveraging significant growth potential.” Tugdual Millet, CEO Hotels, Covivio.
A hotel swap to create value As a reminder, Covivio, through its subsidiary Covivio Hotels, owns 54 hotels that are let to AccorInvest under long-term variable-rent leases based on revenues. AccorInvest owns and operates the operating companies of these hotels and has signed long-term management contracts with the Accor Group.
The memorandum concerns the acquisition by Covivio Hotels of 24 hotel operating companies – allowing the consolidation of these hotels, which will be owned and operated by Covivio Hotels – in exchange for the transfer to AccorInvest of title to 10 other hotels property companies, which will then be owned and operated by AccorInvest. The agreed value of the property companies transferred to AccorInvest is €208 million3, while the value of the operating companies acquired by Covivio Hotels is €266 million4.
Based on 2023 figures, the assets transferred to AccorInvest represent annual rental income of €11 million, while the operating companies acquired by Covivio Hotels generate EBITDA of around €31 million. The deal enables Covivio Hotels to acquire operating companies in major tourist areas with considerable potential for value creation through repositioning and management optimisation. Some of these hotels will continue to operate under Accor brands (under management or franchise agreements), while others will be rebranded.
The transaction marks the continuation of Covivio’s development in hotel real estate, towards a more diversified model (leased assets, operating properties).
Source : Covivio