Starwood, Brookfield Property to sell German Interhotel portfolio to FDM Management
21 May 2016
US private investment firm Starwood Capital Group and commercial real estate company Brookfield Property Partners, yesterday struck a deal to sell the Interhotel portfolio in Germany to FDM Management, a vehicle created by French firm Fonciere des Regions and institutional investors.
Financial terms of the deal were not disclosed, but some media reports suggested that the German hotels are valued at around €700 million ($785 million).
In a separate transaction, Starwood Capital and Brookfield, have agreed to sell the 386-room Mercure Hotel Kongress Chemnitz hotel to Event Hotels.
The Interhotel hotels, which were once controlled by the East German state security service, the Stasi, has a portfolio of nine hotels with 4,131 rooms and prime retail area of around 157,000 square feet located in major cities across eastern Germany.
It has six different brands including the Westin, Park Inn, Ibis and Radisson Blu. The portfolio includes the 1,012-room Park Inn Berlin - which is Berlin's tallest building, located on Alexanderplatz, one of the city's most popular retail locations.
Other properties include the 5-star hotels Westin Grand Berlin, Westin Leipzig and Westin Bellevue Dresden.
"Due to our combination of hospitality and financial expertise, we were able to identify and unlock the value of a high-quality hotel portfolio in strong German markets with multiple branding and development options," said Nick Chadwick, vice president at Starwood Capital.
The Interhotel portfolio is a successful investment in the hospitality sector for Starwood Capital, which has acquired more than $77 billion of real estate assets globally since its inception, including approximately 2,600 hotels and resorts.
Connecticut-based Starwood Capital has raised more than $33 billion of equity capital since its founding in 1991, and currently manages $53 billion in assets.
Brookfield Property Partners is one of the world's largest commercial real estate companies, with over $65 billion in owned assets and around $225 billion in assets under management.