Schroder Real Estate Hotels holds initial €300m closing for its debut pan-European operating hotel fund
21 January 2020
Schroders is pleased to announce the first closing of its debut hotel fund, the Schroder European Operating Hotel Fund I (“the Fund”), with €300m of equity commitments from European institutional investors and family offices. It is structured as a closed-end limited partnership (SCSp) domiciled in Luxembourg with a three year investment period and eight year life.
The Fund’s investment strategy focuses on creating a diversified portfolio of between 10 to15 European hotels through the acquisition, selected refurbishment and operational improvement of existing undermanaged or underinvested 3-5 star hotels across Western Europe’s business and leisure destinations. The Fund will own both the real estate and the underlying operating business of each hotel and Schroder Real Estate Hotels will either manage each property independently or work with an operator under a franchise or hotel management agreement.
The Schroder Real Estate Hotels team comprises almost 40 people operating out of Schroders’ offices in London, Paris and Brussels. The team has a successful track record in acquiring and operating hotels across Europe having purchased more than a hundred hotels over the last 15 years. Over 50 of these have been sold generating strong investment returns for the underlying investors including leading private equity real estate investors. The Fund represents the team’s first vehicle with committed capital.
Frederic de Brem, Head of Schroder Real Estate Hotels, said: ”The support we have received from our long-standing institutional investment partners is a strong endorsement of our business and strategy.
With 60% of the €500m target fund size already raised, and several more investors in the process, we anticipate closing the Fund in a few months with c.€800m of capital (including leverage of 40%) and a strong pipeline including one property already in exclusivity.”
Georg Wunderlin, Global Head of Private Assets, Schroders, commented:
“At a time when yields are at an all-time low across many property sectors we believe that this segment of the hotel market has the capacity to generate attractive, risk-adjusted returns for investors looking for alternative, non-mainstream investment opportunities.”
For further information, please contact:
Estelle Bibby, Head of Media Relations
+44 20 7658 3431
Nicole Mullin, PR Executive
+44 20 7658 4466
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About Schroder Real Estate Hotels
Schroder Real Estate Hotels, a division of Schroder Real Estate created following the acquisition of Algonquin Management Partners, has developed a dual expertise in the hotel management sector, both as an equity investor and as an independent hotel operator. With 48 hotels totaling 8,150 rooms and assets under management of €2.1 billion as at 30 June 2019, Schroder Real Estate Hotels is one of Europe's leading hotel investment and asset managers with operations in Paris, London and Brussels. With an international hotel team and a specialization in European hotel real estate, Schroder Real Estate Hotels supports its investment partners by participating directly in investments and supervising all operational issues specific to this asset class.
Schroder Real Estate
Schroders has managed real estate funds since 1971 and currently has £16.2 billion (€18.1 / US$20.6 billion)* of gross real estate assets under management as at 30 June 2019.
Most of the real estate funds referred to are unauthorised collective investment schemes as defined in the Financial Services and Markets Act 2000. Promotion of these funds is restricted and access to full information about these funds is only available to those exempt from the restriction.
For further information about Schroders’ real estate business visit www.schroders.com/realestate
*Real Estate AUM includes holdings of Schroder Real Estate Capital Partners and Schroders Multi-asset Funds.
As a global investment manager, we help institutions, intermediaries and individuals meet their goals, fulfil their ambitions, and prepare for the future. But as the world changes, so do our clients’ needs. That’s why we have a long history of adapting to suit the times and keeping our focus on what matters most to our clients.
Doing this takes experience and expertise. We bring together people and data to spot the trends that will shape the future. This provides a unique perspective which allows us to always invest with conviction. We are responsible for £444.4 billion (€496.6 billion/$565.5 billion)* of assets for our clients who trust us to deliver sustainable returns. We remain determined to build future prosperity for them, and for all of society. Today, we have 5,000 people across six continents who focus on doing just this.
We are a global business that’s managed locally. This allows us to always keep our clients’ needs at the heart of everything we do. For over 200 years and more than seven generations we’ve grown and developed our expertise in tandem with our clients’ needs and interests.
Further information about Schroders can be found at www.schroders.com.
Issued by Schroder Investment Management Limited. Registration No 1893220 England. Authorised and regulated by the Financial Conduct Authority. For regular updates by e-mail please register online at www.schroders.com for our alerting service.
*as at 30 June 2019
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