Accor buys $1.23bln worth of European hotels

Maybe the asset-light approach isn't all it's cracked up to be. Accor has reportedly agreed to buy hotels in Germany, the Netherlands and Switzerland for about $1.23 billion as part of an overall plan to boost the company’s real-estate holdings.

"These transactions send a strong signal of our capability to rapidly implement the strategy of restructuring the HotelInvest portfolio," Accor CEO Sebastien Bazin said.

Earlier this year, Bazin implemented a new two-prong approach to the company: one focusing on operating the group’s 14 global hotel brands; the other focusing on hotel ownership and investment. HotelInvest—focusing on ownership and investment—will reportedly stop selling hotels the group owns, unless they are underperforming. The other pole—HotelServices—will operate the group’s 3,600 hotels under a fee-based system. Bazin said there were no plans to dispose of any of the group’s existing hotel brands.

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In total, Accor is buying 86 hotels with 11,286 rooms in Germany and the Netherlands from funds managed by Moor Park Capital Partners LLP, according to the statement. After the purchases, HotelInvest’s owned hotels will contribute about 68 percent of the unit’s net operating income compared with a medium-term target of 75 percent, Bloomberg reports.

Bazin said under the former system, the group didn’t create enough value. “Sorry to disappoint you, that’s behind us. If we had sold our assets, this would have hampered our growth,” Bazin said in November.

 

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