Nevada-based Trans World Corporation, an owner and operator of European casinos and hotels, has acquired—through its subsidiary Trans World Hotels Germany—the Lindner Sport & Aktivhotel Kranichhöhe, a business and recreational hotel property in Much, Germany, approximately 19 miles northeast of Bonn.
The 107-room hotel had been operating under the Lindner Hotels & Resorts banner for approximately ten years. TWC will operate the hotel under its Trans World Hotels brand and has planned renovations to upgrade the property to four-stars from its current three-star rating. TWC intends to rename the property Hotel Kranichhöhe.
"This is a very important addition to our TWH brand and portfolio," Rami Ramadan, CEO of TWC, said in a statement. "The business segmentation generated by this attractive hotel is an excellent fit with our existing properties in Germany. We anticipate that this acquisition will create enterprise synergies that should enable us to generate incremental revenue and earnings to TWC’s already very successful operation.”
The total project costs are expected to reach approximately $7.3 million, including $1.6 million to update and partially renovate the hotel, plus closing costs and a 6.5-percent real estate transfer tax. TWC will fund 42 percent of the project costs, or approximately $3.1 million, with cash flow from operations, and the balance of $4.2 million coming in the form of debt from Kreissparkasse Koln, a local German bank. Under the terms of the bank deal, after 11 years, TWC will have the option to retire the remaining principal or to refinance the balance at prevailing commercial interest rates.
The economic effect of the acquisition will be recorded on the Company’s books retroactive to December 1, 2016, with no effect on the purchase price.
TWC currently owns two four-star hotels in Germany: Hotel Freizeit Auefeld in Hann. Münden, and the Hotel Columbus in Seligenstadt, near Frankfurt.