CPA:18 – Global Buys Wyndham Hotel in Germany for $33.8 Million
CPA:18 – Global, a publicly registered non-traded real estate investment trust sponsored by W.P. Carey Inc. (NYSE: WPC), completed a sale-leaseback transaction to purchase a majority stake in the Wyndham Stuttgart Airport Messe hotel for approximately $33.8 million. The hotel operating company has entered into a 20-year net lease for the property.
The hotel, which was originally built in 1987, underwent an extensive renovation that began in 2012 and included all the rooms and common areas, such as the lobby, restaurant and bar. The façade was also updated in 2015, and a modern conference facility is expected to be added this year.
The property is built on one of only two land parcels allotted for hotel operations at Stuttgart Airport. Its location is adjacent to the passenger terminal at the airport, the sixth busiest in Germany with 10 million passengers per year. Additionally, the Stuttgart Messe, Germany’s ninth largest trade center, relocated next to the hotel in 2007 and continues to positively impact hotel occupancy. Ernst & Young’s new German headquarters is also adjacent to the hotel and is expected to open this year.
The city of Stuttgart is an economic and business center in Germany that has attracted major firms, such as Bosch, Mercedes, Porsche, Lenovo and Siemens.
Grand City Hotels, one of the largest German hotel operators, will continue to manage the hotel. It currently holds an AAA rating from German hotel specialist TREUGAST and manages more than 120 hotels and 15,500 rooms with more than three million guests each year.
The 20-year net lease with the hotel operating company is fully guaranteed by its parent company and includes fixed annual rent escalations.
“This transaction offered the opportunity for CPA:18 – Global to invest in a uniquely positioned hospitality asset in one of Europe’s leading industrial and business cities, commented Arvi Luoma, executive director at W. P. Carey. “It also increased the number of German hotel assets in the portfolio, further demonstrating our strength in Central Europe and our ability to deliver tailored real estate financing solutions in this sector…”
W. P. Carey Inc. is a global net lease real estate investment trust specializing in corporate sale-leaseback financing, build-to-suit financing and the acquisition of single-tenant net lease properties.
