European RE groups acquire hotels in Ireland, Japan

London-based Deutsche Finance International, in a joint venture with Ireland's BCP Capital, has acquired the 132-year-old Central Hotel on Dublin’s Exchequer St., as well as a nearby parking lot. Photo credit: Central Hotel

Two European real estate groups have completed transactions in Ireland and Japan, acquiring a historic property and one that won't be seen until next year, respectively.

London-based private equity real estate group Deutsche Finance International, in a joint venture with Ireland's BCP Capital, has acquired the 132-year-old Central Hotel on Dublin’s Exchequer St., as well as a nearby parking lot. The JV plans to refurbish the building and add guestrooms.

The property will be operated by Windward Management.

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The financial details of the deal were not disclosed, although real estate agents Cushman & Wakefield put the 70-room hotel on the market last October for €40 million.

The investment follows the recent close of Deutsche Finance's inaugural fund, DFI European Value-Add Fund, with €436 million of equity, including co-investment. "These are our first investments for the fund in Ireland, allowing us to create value in prime locations and benefit from highly supportive structural trends, including an undersupplied commercial real estate market, strong GDP growth and high levels of foreign direct investment," said Paul Nearchou, director at Deutsche Finance,."Against this backdrop we feel confident in our ability, and that of our partners BCP Capital, to maximize the inherent value in these two prime central Dublin assets."

At the same time, Paris-based AXA Investment Managers Real Assets has agreed to acquire a budget hotel to be completed in 2020 in Hiroshima, Japan, for JPY4.6 billion (€37 million). 

AXA acquired the hotel on behalf of a client from a joint venture between GreenOak Investment Management KK and Red Planet Japan Inc., which will operate the hotel as the Red Planet Hiroshima Nagarekawa on a lease until 2040.
"This acquisition is in line with our strategy to increase our exposure in the hotels sector in the region, and especially in the city of Hiroshima, which is consistently ranked as a top tourist destination in Japan," said Laurent Jacquemin, head of Asia-Pacific at AXA IM-Real Assets. "We look forward to working with Red Planet, a well-recognized brand and operator of 30 budget hotels across the region. As Red Planet Hiroshima Nagarekawa is their sixth development in Japan, we are well-positioned to benefit from their local market expertise as well as from the expected, rapidly rising inbound visitation to Japan. We will continue to seek further opportunities to add to our income-producing managed portfolio."

The acquisition adds to AXA's €2.5 billion portfolio of hotels across 11 countries that it manages.

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