Valotel Holding SA aims to grow hotel investment portfolio [Infographic]
Valotel Holding SA to acquire new properties around Switzerland
After an initial funding round of $49 million Valotel Holding SA is in a strong position in the Swiss hotel investment market.
After recent restructuring, Valotel Holding (Suisse) SA aims to use internal expertise in development, asset management and hotel management to become Switzerland’s leader in hotel investment.
A targeted investment strategy backed by a fund on CHF 100 million ($102 million) is part of the strategy to reach this goal.
Opening a lucrative niche market
Valotel Holding has found an opportunity to seize investment opportunities in the Swiss hospitality industry.
With most capital markets lacking knowledge in the hotel property market, financing conditions are usually less favourable and are thus projects in the hotel sector are overlooked.
An emanation of GoodNight Partners SA, Valotel Holding aims to capitalise on this situation and offer investors the chance to diversify into this niche market.
This means secure hotel property transactions and a tailored asset management strategy will bring controlled growth of up to 10% until 2023. Distribution opportunities will also be superior to traditional property asset classes with around 5% – 6.5% rather than the usual 2.5% – 4%.
To ensure these attractive gains for investors, Valotel Holding will focus on budget to mid-scale properties in busy locations. This includes areas close to train stations, motorways, convention centres and airports.
These locations will attract mainly business travellers, ensuring the hotels’ performance will not experience much seasonality and stay consistent throughout the year.
This strategy, paired with Switzerland’s stable economic environment, gives Valotel Holdings the flexibility to take on different levels of operational risk and direct involvement, depending on each property’s unique features.
Initial fundraising brings in over CHF 48 million ($49 million)
Valotel Holding announced its first round of funding worth more than CHF 48 million ($49 million) which enabled it to build its hotels portfolio.
The first properties acquired included the operating hotels ibis Sion-Est, ibis Rothrist-Olten and NH Fribourg, as well as a hotel project in St. Gallen being developed by GoodNight Partners SA, which is set to be completed in 2021.
Other opportunities have also been secured, including an operating hotel in the canton of Fribourg and a project close to Lake Geneva.
Working with a strong partner
The Swiss holding relies on its exclusive advisor GoodNight Partners SA (GNP), which is involved throughout the value chain of a hotel property asset.
Founded in 2014, GNP now manages more than CHF 90 million ($91 million) in assets and has CHF 196 million ($ 199 million) in assets under development on behalf of third parties.
Arjun Fornerod, Managing Director of GoodNight Partners SA: “We are very pleased to see the materialisation of the investment strategy initiated in 2018 and the launch of Valotel Holding (Suisse) SA, which reflects the confidence of our investors. As a minority investor in the holding company, we affirm our willingness to take a share of the risk in this project – a project we firmly believe in. Our position is boosted by the expertise in the Swiss hospitality industry and tourism market that our team members have developed over the past 15 years.”
According to the TOPHOTELCONSTRUCTION online database, 98 new properties will enter the Swiss hotel market within the few years:
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