L+R Hotels and PGGM Announce Hotel Venture Targeting up to €1 billion Investments in Europe
Main Photo: A selection of the L+R portfolio
Date: January 2022
Name: LRO Hospitality
Location: Europe
Number of Keys: TBA
Partners: L+R Hotels, a London-based hotel investor and operator, and Dutch pension fund manager PGGM Buyer:
L+R Hotels, a London-based Hotel investor and operator, and Dutch pension fund manager PGGM have backed a European value-add hotel venture launched by LRO Hospitality. The new hotel asset management company LRO Hospitality is set up by L+R Hotels and John Ozinga, former CEO of Accor Invest.
It’s experienced and dedicated team will originate transactions through its extensive network of industry contacts, actively manage hotels, and implement asset management strategies to enhance overall quality and performance to maximize investor returns. The team is led by CEO John Ozinga and CIO Henri Wilmes and will be supported by L+R Hotels’ asset management team throughout the life cycle of the investments. Focus will be placed on key Western European city markets in France, Germany, Benelux, Spain and Italy.
John Ozinga, founder and CEO of LRO Hospitality said: “Current market conditions will present LRO Hospitality with attractive investment opportunities to acquire from investors or operators facing cash flow challenges. Given the expected short to mid-term post-pandemic recovery, we believe it is the best time for us to launch our first hotel venture.”
Desmond Taljaard, Managing Director of L+R Hotels, said: “We are pleased to enter into this venture with PGGM as we believe in the resilience of the hotel market and it’s recovery in the future. The commitment of PGGM shows their confidence in our ability as deal sourcer, hotel operator and asset manager to create value, and their appetite for the European hospitality sector as an institutional asset class, despite the negative short-term impact of the COVID crisis”.
Tinka Kleine, Senior Director Private Real Estate for PGGM, said: “We have added hotels to our city focused investment programme because it offers attractive investment opportunities, both for achieving financial returns and for improving the sustainability performance of well-located assets. The strong track record of L+R Hotels and the LRO team in securing and executing such strategy provides a perfect base for a successful partnership.”
LRO Hospitality targets levered investments aggregating up to €1bn, comprising both Real Estate and Operations, from budget to upscale hotel opportunities in Western Europe which have become stressed, but offer significant recovery value to achieve attractive risk-adjusted returns as the hotel sector returns to market stability toward 2023/2024. It takes a proactive, operator-driven approach, focusing on investments that offer long-term value creation opportunities for its investors.
L+R Hotels has a 30-year track record in hotel investment. Between 2010-2021, L+R Hotels has assembled a €5,000 million portfolio of over 100 hotels across Europe, USA and the Caribbean, comprising over 21,000 keys. All hotels are under L+R Hotels’ strategic asset management, with c90% also being directly operated by L+R Hotels. Global Brand partners include Hilton, Marriott, IHG and Accor.
PGGM is a not-for-profit cooperative pension fund service provider. As a pensions administrator, asset manager and advisor to pension fund boards, it executes its social mandate: to provide for good old-age incomes for 4.4 million participants in the Netherlands. On December 31, 2021 PGGM managed long-term pension capital of EUR 291 billion worldwide. Rooted firmly in the Dutch healthcare sector, PGGM develops innovative provisions for labour market issues in this sector, alone or with strategic partners. Their member organisation PGGM&CO supports 764,000 workers and pensioners with a background in healthcare.
Price: Upto €1bn
THPT Comment: Wow, an assembled group of giants, to create LRO Hospitality with two great experienced hands at the helm. Look forward to seeing what they get upto!
First Seen: PGGM press release
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