A joint-venture led by UK-based private equity real estate fund manager Benson Elliot Real Estate Partners V, LP (“Benson Elliot”) and Schroder Real Estate Hotels (“SREH”, formerly Algonquin) has acquired three hotels (the “Portfolio”) totalling 1,183 rooms in Disneyland, Paris. The themed hotels, which are adjacent to one another, were acquired off-market in two separate transactions for a total investment of circa €240 million.
Dream Castle and Magic Circus, both four star hotels, were purchased from Austrian real estate developers Warimpex / UBM, while Explorers was purchased from a JV managed by SREH. The investment is structured as a 50/50 JV between Benson Elliot and a consortium of private investors advised by SREH.
Disneyland Paris is Walt Disney’s only European theme park and Europe’s most popular tourist destination. The Disney market has experienced almost uninterrupted growth for the last 15 years, set to be driven further by Disney’s €2 billion expansion plan, which will be rolled out from 2021 and is the most ambitious project undertaken since the park opened in 1992.
Developed between 2003 and 2007, the Portfolio has a profitable trading profile and generates strong cash flow. Whilst the assets have benefitted from substantial investment, significant opportunities remain for the JV to create further value through the implementation of targeted asset management initiatives.
The JV has engaged SREH as the Portfolio’s manager.
Marc-Olivier Assouline, Benson Elliot Principal, said: “The Portfolio represents a collection of high-quality, cash-flowing assets being acquired at a substantial discount to replacement cost. The hotels present opportunities to optimise value and grow income through targeted refurbishment programmes. Benson Elliot has built a strong track record in the hotel sector, with over €1 bn in hotel investments and dispositions in just the last five years. This transaction marks another partnership with the former Algonquin team, with whom we have worked successfully in the past.”