VIY Greater Europe Hospitality Fund SICAV-SIF has today closed the sale of its stake in Radisson Blu Park Royal Palace Hotel in Vienna to the newly founded Luxembourg hotel fund ECHO Fund SCSp (“ECHO”). The transaction involved the sale of the hotel and the parking area with a total asset price for EUR 66 mln. VIYM, a private equity firm with extensive expertise in the hospitality industry, assisted the Seller on the deal.
The Radisson Blu Park Royal Palace Hotel property is leased by the largest Austrian hotel operator Austria Trend Hotels and located at the intersection of the 13th and 14th districts of Vienna, just meters from the Technical museum and directly opposite the Schönbrunn Palace. The upscale mixed-use hotel property comprises 233 rooms of different categories including 21 suites, 10 private residences and a fully developed infrastructure. The hotel facilities include a restaurant, bar, lobby, conference hall, SPA and fitness center.
In the course of advisory services provided by VIYM to the owner of the property, there were a range of achievements which increased the value of the project. VIYM assisted the owner of the property in rebranding the hotel into Radisson Blu brand. Previously named Austria Trend Hotel Park Royal Palace Vienna, the hotel started operating under the Radisson Blu brand from January 2018.
The private equity firm also provided consultancy services for the process of renovating and selling the private residences, which was completed in November 2018. Gloriette’s Residences is a complex of apartments on the top floors of Radisson Blu Park Royal Palace Hotel Vienna and includes 10 serviced apartments which range in size from 130m2 to 180m2. The average price per square meter reached over 8 000 Euros. The project was designed and implemented by world renowned design bureau A2ZEN and offers outstanding views over the Schönbrunn Palace, Gloriette, and the Technical museum.
Commenting on the deal, VIYM’s co-founder Andrey Yakunin, said: “Due to its prime business location and high quality of life, Vienna is one of the most attractive European capitals for investors and businessmen. Radisson Blu Park Royal Palace Hotel has great access to public transportation and is only a short ride away from the city center which makes the property especially appealing to potential buyers. As an advisor to the owner throughout the project lifecycle, VIYM oversaw several initiatives, which included rebranding the hotel, renegotiating the terms of bank financing and completing the process of renovating and selling the private residences, ultimately helping to achieve the best possible deal for the owner.”
Vitus Eckert, Founding Partner of ECHO states: “With our first acquisition after founding our first ECHO fund we have proven our strong sourcing and asset management capabilities. We expect to acquire two more hotels in line with our acquisition criteria.”
Michael Regner, Founding Partner of ECHO adds: “The property offers very attractive conditions to our investors with considerable value increase in the future. As a first step we have already implemented the start of a value-added extension of 14 rooms.”
VIYM is an authorised Alternative Investment Fund Manager, regulated in Luxembourg and dedicated solely to private equity services for international investors seeking investment consulting, deal origination and asset management. VIYM targets those who seek a diverse and comprehensive strategy and provides them with exposure to a balanced risk/return profile between the established European markets and the fast-growing, emerging opportunities of Russia and other CIS economies. To provide stable returns and value-added upside potential, the firm varies its investments from the growth capital markets of Small and Mid Caps to secure real estate investments.
About VIY Greater Europe Hospitality Fund
VIY Greater Europe Hospitality Fund pursues a diversified, value-added and opportunistic strategy across moderate to high-risk hospitality real estate (mid, upscale and luxury). The Fund invests in projects with mixed-use exposure such as office and retail, healthcare and lifestyle real estate, and apartments in the developed markets of Greater Europe, and in emerging markets, primarily focusing on opportunities in the untapped high-growth markets of Russia and other FSU countries.
About ECHO Partners AG
ECHO Partners AG (“ECHO”), based in Pfäffikon, Switzerland, invests in hotels, which are located in leading Continental European tourist destinations, such as Vienna, Amsterdam or Budapest and relies on long-term tourism trends. The Fund is identifying and purchasing hotels with a purchase price in the EUR 10-70MM range and a target acquisition yield at or above 5%. The ECHO Fund is the first investment fund of ECHO Partners to implement this strategy