Stockholm-based East Capital Baltic Property Fund III has purchased the 202-room Hilton Tallinn Park in Estonia for €48 million from Olympic Entertainment Group subsidiary Jessy Investments (via fellow subordinate Kesklinna Hotelli).
The operators of both the Hilton Tallinn Park Hotel and Olympic Park Casino, which opened just last month, are part of the OEG group and will remain contracted on a long-term basis.
“The aim of the sales transaction is to release capital that has been invested into real estate and to focus on the core business of the group – operating casino and entertainment complexes,” Olympic Entertainment Group CEO Madis Jääger said in a statement. “The hotel and casino operations that are in the building are not part of the sales transaction and will continue to be owned by OEG group.”
After completing the transaction, the non-current assets of OEG group will decrease by approximately €30 million, Jääger said, and liabilities will decrease by €25 million. The profit from the sales transaction, taking into account transaction-related costs, is approximately €17 million.
Launched in August 2015, the €100-million East Capital Baltic Property Fund III is East Capital's third vehicle since 2005 to target the real estate sector in the Baltic with investments in high-quality commercial properties within retail, office and logistics in Tallinn, Riga and Vilnius. The fund is tailored for institutional investors.