Covivio and Accorinvest negotiate $1 million deal: a day ticket

Real estate company Covivio and Accorinvest have begun negotiations on the exchange deal. Accorinvest owns several properties operating under the Accor brands, and most employees are also affiliated with Accorinvest. It is reported that additional hotels worth two billion euros will be sold. Accor awarded most of the properties to Accorinvest in 2017. Legally, these companies are separate. However, Accor has a stake in Accorinvest.

The current transaction with Covivio is expected to take the form of an exchange of business assets currently held by AccorInvest for hotel properties owned by Covivio’s subsidiary Covivio Hotels. Following the deal, Covivio Hotels will own 24 operating hotels and AccorInvest will own 10.

The agreed value of the properties transferred to AccorInvest is approximately €210 million, and the value of the business assets acquired from Covivio Hotels is approximately €260 million.

Covivio Hotels is also a co-partner and asset manager of another 60 hotels leased to AccorInvest and held through two joint ventures established in 2010 and 2014: one owned 80 percent by Crédit Agricole Assurances and 20 percent by Covivio Hotels, others by La. Caisse des Dépôts, Société Générale Assurances and Covivio Hotels. An exclusive agreement was also signed to consolidate the real estate and operational assets of 25 of these hotels: 19 joint venture hotels and six AccorInvest.

These merger transactions of Covivio Hotels and joint ventures represent an aggregate amount of €390 million of hotel properties transferred, which is equivalent to the value of the acquired business assets, making the transaction liquidity neutral. Upon completion of the transaction, Covivio Hotels and its partners will have consolidated ownership of 43 hotels and AccorInvest will own 16 hotels.

Through this transaction, Covivio Hotels intends to increase its ability to directly impact portfolio performance by repositioning some of the hotels it has owned for nearly 20 years to capitalize on their significant growth potential.

Report: AccorInevst wants to sell hotel assets worth more than $2 billion

As sources told Bloomberg in October 2023, Accorinvest also plans to sell hotels in Europe and Latin America worth more than €2 billion.

AccorInvest has Sofitel-branded hotels for sale in Paris, as well as five Ibis hotels in Britain, a hotel in the Netherlands, a Sofitel in Central Europe and several other properties, Bloomberg has learned.

According to Bloomberg, the money will be used at least partially to pay off debt.

The companies did not comment on the report.

At the beginning of October, Accor issued a 5.5-year hybrid bond with a yield of 7.3 percent to control its debt.