Varde Partners seals €600m sale of European luxury hotel portfolio


Varde Partners has sealed a €600m exit of a portfolio of eight luxury hotels to European real estate operator Covivio.

The private equity house began buying up the debt of the hotels, which operate under the Dedica Anthology brand, through a series of deals in 2016, and ultimately acquired 100 per cent of the equity a year later.

Varde said the portfolio comprises hotels with an aggregate of over 1,100 rooms in Rome, Nice, Budapest, Prague, Florence and Venice.

Francisco Milone, partner and head of European Real Estate at Värde Partners, said, “At the time we acquired the business it was in severe financial difficulty and facing an uncertain future.

“Having appointed a best-in-class management team, together we have rebuilt trust with the company’s financial partners allowing us to refinance the business and execute an ambitious investment programme.

“Our real estate investment strategy targets opportunistic and value-add investments across commercial and residential markets, and we continue to explore opportunities in the Italian market.”

Värde began investing in Italy starting in 2006, and opened its office in Milan in 2014.

To date the firm has invested $1.5bn in the country across real estate, UTP, NPL, sovereign and corporate credit.

The transaction is expected to close in the first half of 2020, subject to closing conditions.

Late last year Värde completed its largest ever private equity fundraise by pulling in $2.47bn of commitments for its 13th flagship investment vehicle.

The firm was initially targeting $2bn for Värde Fund XIII, and easily surpassed the $1.75bn it gathered for its predecessor vehicle.

Fund XIII is expected to continue the firm’s focus on credit, real estate and specialty finance.

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