Deal of the Year Awards Winners

Published September 2018

The organizers of the Hotel Investment Conference Europe (Hot.E) 2018, announced the winners of the Hot.E Deal of the Year Awards in the categories of Merger & Acquisition/Portfolio of the Year and Single Asset Transaction of the Year. The awards were presented at Hot.E on 27 September 2018, at the Hilton London Bankside.

The Principal Hotel Company portfolio sale to Covivio was named Merger & Acquisition/Portfolio of the Year. Starwood Capital Group has sold a portfolio of 14 U.K. hotels that form part of The Principal Hotel Company to Covivio. The portfolio consists of 14 leading, full-service hotels comprised of 2,638 keys and split across two distinct landmark brands, Principal (12 hotels) and De Vere (2 hotels). The properties occupy flagship locations in high-growth cities across the U.K., including London, Manchester, Edinburgh, Glasgow, Oxford, York and Leeds. Included in the portfolio are The Principal London and The Principal Manchester, two of the most iconic and historic hotels in the U.K. The Principal Hotel Company includes many of the properties that Starwood acquired through the purchase of Principal Hayley in 2013, Four Pillars and De Vere in 2014, and the Townhouse Collection in 2015, and the subsequent combination of the four portfolios. Starwood has invested significant capital into the portfolio in recent years to reinvigorate the properties and relaunch the Principal and De Vere brands to the market. This includes the highly acclaimed openings of The Principal Edinburgh Charlotte Square, The Principal York, The Principal Manchester, The Principal Edinburgh George Street and the flagship of the brand, The Principal London, which will complete its dramatic restoration this summer. The De Vere brand recently celebrated its official relaunch following substantial investment across the estate, which saw its historic, mansion house hotels extensively renovated to celebrate their British heritage and stunning natural landscapes. Following the successful rollout of its new Smart Space meeting and events product, together with nearly a dozen new restaurants and bars, De Vere has cemented its position as the U.K.’s leading independent conference hotel group. Eastdil Secured, UBS, and law firm Paul Hastings LLP served as advisors on the transaction. Finalists in this category also included Jury’s Inn portfolio sale to Pandox and Oaktree Capital Management sale of SACO Serviced Apartments to Brookfield.

The Hilton Amsterdam Airport Schiphol was named Single Asset Transaction of the Year. The 433-room, five-star Hilton Amsterdam Airport Schiphol was sold by developer Schiphol Real Estate to Host Hotels & Resorts’ European Joint Venture for €148 million, in December 2017. Schiphol Real Estate was represented by HVS Hodges Ward Elliott. Host was selected as preferred purchaser following a very competitive two-round bidding process. Due to some complicated issues that arose after the Heads of Terms were agreed, the deal remained in exclusivity for almost 18 months while the buyer and the seller worked to solve these issues. The perseverance of, and trust between, each party during this period was crucial to the successful finalization of the deal. In developing this new-build property, Schiphol Real Estate’s aim was to replace an outdated 1970’s hotel with a brand new, internationally branded upper upscale hotel, to become a striking landmark at the entrance to Amsterdam Schiphol Airport, and to secure a development profit on exit. Host’s aim was to acquire a major institutional quality Amsterdam hotel investment, in a location with low risk of oversupply, while exceeding minimum financial return thresholds. Schiphol Real Estate’s strategy began with the acquisition of Hilton’s long-term leasehold interest in the “old” 1970’s Hilton hotel, so that it could be replaced by this brand-new architectural landmark that now adjoins the World Trade Centre office complex and the airport’s main terminal. A new long-term management agreement was agreed with Hilton. The old hotel continued to trade until the directly adjacent new hotel was completed, after which the old hotel was demolished. As such, the new hotel was able to “hit the ground running”, by transferring the business into the new hotel with limited disruption, to help secure a strong first year performance and therefore a strong initial yield for the purchaser (unlike most new-build hotels). Arguably the best Hilton Hotel in Europe and with direct covered connection to the airport’s main terminal, the property includes a 2,000 sqm meter conference center including 23 meeting spaces and a 500 sqm ballroom, making it one of Amsterdam’s leading conference hotels. Other features of the property include a striking 40-meter-high internal atrium and an iconic façade featuring diamond shaped windows and aluminum paneling. The hotel won a number of major design awards, including the European Hotel Design Award for best newbuild hotel. The other finalists in this category were Le Meridien Frankfurt and Sofitel Budapest.

The Hot.E Deal of the Year Awards were established to recognize the companies responsible for some of the most influential hospitality industry investments occurring in the European marketplace over the course of the past year. Philip Ward of JLL chaired the Merger & Acquisition/Portfolio of the Year Award committee, and Marvin Rust of Alvarez and Marsal chaired the Single Asset Transaction of the Year Award committee. The two committees were comprised of hotel industry leaders who selected, reviewed, and nominated deals. The finalist information was then sent to the Hot.E delegates for voting.