Union Investment has sold the property leased to the Motel One hotel chain at Rue Royale 120 in Brussels to M&G Real Estate. The acquisition was made for the portfolio of the M&G European Property Fund. The two contracting parties have agreed not to disclose the financial terms or the exact purchase price.
The hotel comprises a total of 490 rooms and is located in the immediate vicinity of Brussels Central Station. Owing to its central location within the Belgian capital, the property caters equally to business travellers and private city tourists. Hotel operations are secured via a long-term lease agreement with Motel One Belgium.
Development history and portfolio streamlining
Union Investment originally secured the property in 2011 as part of a development project. Following its scheduled completion in 2014, the hotel was transferred into the assets of the open-ended public property fund UniInstitutional European Real Estate, which is aimed at institutional investors.
Carsten Thiel, Head of Fund Management Open-Ended Property Funds at Union Investment, stated that the hotel property had developed positively over the twelve-year holding period. He noted that the disposal made it possible to capitalise on the currently favourable market environment in Belgium for a successful sale. In doing so, the fund management company is rejuvenating its existing portfolio whilst simultaneously strengthening the fund's liquidity.
Transaction advisory
The sales process was supported on the vendor's side by specialised consultancy firms. In carrying out the transaction, Union Investment relied on a combination of legal, tax and commercial advice.
- —Clifford Chance provided legal and tax advice to Union Investment.
- —Eastdil Secured Savills advised the Hamburg-based investment manager as sell-side adviser.
- —M&G Real Estate will hold the property in the M&G European Property Fund going forward.
With the change of ownership, the 490-room property passes into the investment portfolio of the British investment manager; hotel operations under the Motel One brand remain unaffected.
