Covivio and AccorInvest sign a memorandum of understanding with a view to consolidating their hotel properties and business assets

A hotel swap to create value

As a reminder, Covivio, through its subsidiary Covivio Hotels[1], owns 54 hotels that are let to AccorInvest under long-term variable-rent leases based on revenues. AccorInvest owns and operates the operating companies of these hotels and has signed long-term management contracts with the Accor Group.

The memorandum concerns the acquisition by Covivio Hotels of 24 hotel operating companies[2] – allowing the consolidation of these hotels, which will be owned and operated by Covivio Hotels – in exchange for the transfer to AccorInvest of title to 10 other hotels property companies, which will then be owned and operated by AccorInvest.

The agreed value of the property companies transferred to AccorInvest is €208 million[3], while the value of the operating companies acquired by Covivio Hotels is €266 million[4]. Based on 2023 figures, the assets transferred to AccorInvest represent annual rental income of €11 million, while the operating companies acquired by Covivio Hotels generate EBITDA of around €31 million.

The deal enables Covivio Hotels to acquire operating companies in major tourist areas with considerable potential for value creation through repositioning and management optimisation. Some of these hotels will continue to operate under Accor brands (under management or franchise agreements), while others will be rebranded. The transaction marks the continuation of Covivio’s development in hotel real estate, towards a more diversified model (leased assets, operating properties).

A further step is also underway for hotels held in joint ventures

Covivio Hotels is also the indirect owner and asset manager of another 60 hotels leased to AccorInvest and held through two joint ventures created in 2010 and 2014 respectively: one 80% owned by Crédit Agricole Assurances and 20% by Covivio Hotels, and the other owned by Caisse des Dépôts et Consignations, Société Générale Assurances and Covivio Hotels.

The memorandum provides for the acquisition by Covivio Hotels and its partners of 19 operating companies[5] for the 2 joint ventures (thereby enabling them to be consolidated as properties owned and operated by Covivio Hotels and its partners) in exchange for the transfer to AccorInvest of six other hotel property companies, which will then be owned by AccorInvest.

These consolidation transactions for Covivio Hotels and the joint ventures represent a total of €393 million[6] for the hotel property companies sold by Covivio Hotels and its partners, equivalent to that of the operating companies owned and operated by the companies whose shares will be acquired. Upon completion, Covivio Hotels and its partners will have consolidated ownership of 43 hotels and AccorInvest 16.

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[1] 52.2% owned and controlled by Covivio. The figures in this press release represent Covivio Hotels’ share.

[2] Through the acquisition of shares in hotel operating companies

[3] Excluding transfer taxes

[4] Including transfer taxes

[5] Through the acquisition of shares in hotel operating companies

[6] Including transfer taxes