INVESTMENT
should be announced before the year ’ s end . “ You need to pay for quality , and maybe it ’ s a bit cheaper than at the peak to get a reasonable return . But buying at a steep discount ultimately fails . Buying weaker assets maybe is not such a great idea .”
The new fund is a 10-year vehicle as ECE wants a bit more time to maneuver and the group is absolutely looking at raising additional hotel funds . “ Some 10 years ago we started our first fund in retail . Today , we have US $ 5 billion in assets under management in retail funds . We wouldn ’ t touch hotels unless we believed we could scale this up significantly ,” Kraft said . “ But it ’ s step by step . We will be selective with the first fund , but our objective is to do more than one and make a long-term strategy . After the valueadd fund , when markets stabilize , funds could be more open-ended income funds . It depends on situation .”
Bigger picture , while guidance suggests a more complete hotel recovery in Europe in two to four years , Kókai is a bit more bullish and already seeing a rebound in leisure business . ( ECE has an active hotel development arm in the Germanspeaking region doing groundup development with the likes of Motel 1 , 25hours and Steigenberger and then selling to institutional investors .) “ We remain positive about hotels having positive longterm fundamental trends despite some recent doomsayers ,” Kókai says .
But he adds the hotel investment market in Europe still hasn ’ t seen the full impact of the pandemic with assets being shielded by lenders . But as he speaks to other observers ,
“ THERE IS A LACK OF PRODUCT NOW , BUT THERE WILL BE MORE OPPORTUNITIES COMING AS VARIOUS STAKEHOLDERS IN THE INVESTMENT CHAIN START SEEING OPTIONS AND THINGS START MOVING . OUR TIMING WILL ONLY GET BETTER .”
– ASCAN KÓKAI
sentiment suggest support programs will soon expires and patience will run thin , creating more M & A activity and opportunities . “ There is a lack of product now , but there will be more opportunities coming as various stakeholders in the investment chain start seeing options and things start moving ,” Kókai adds . “ Our timing will only get better .”
40 hotelsmag . com September / October 2021