Värde Partners’ Value-Add Play Reels In $641M

The company is selling eight prestigious hotels spread out across popular European destinations, including Rome, Florence and Venice.

Värde Partners has agreed to sell its eight-property portfolio of luxury hotels under The Dedica Anthology brand to Covivio. The French real estate company will pay $641 million, or €573 million, in a transaction that is expected to close in the first half of 2020.  

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The 1,115-key portfolio of mostly five-star hotels is spread throughout popular European tourist destinations and includes Palazzo Naiadi in Rome, Plaza Nice in Nice, New York Palace and New York Residence in Budapest, Carlo IV in Prague, Palazzo Gaddi in Florence, and Grand Hotel Del Dogi and Hotel Bellini in Venice. Once the transaction closes, the hotels’ new French owners will operate them under the NH Collection, NH Hotels and Anantara Hotel & Resorts brands.

At the same time as the eight-hotel deal, Covivio also purchased a 120-key Hilton hotel in Dublin for $50.9 million, or €45.5 million.

Restoring an anthology

While bundled together as The Dedica Anthology brand now, each of the eight hotels had its own prestige. In 2016, Värde began buying the debt of Gruppo Boscolo, the Italian company that owned the hotels that now make up The Dedica Anthology. Later in 2017, Värde acquired 100 percent of the equity for the properties and rebranded them as The Dedica Anthology in 2018.

Francisco Milone, partner & head of European real estate at Värde, said the hotels were in severe financial difficulty and facing an uncertain future at the time of the acquisition. Sources familiar with the deal told Commercial Property Executive that Värde took several steps to bring the hotels back into financial stability, including refinancing the business, rebranding the hotels, putting in place an expert management team and pursuing an expensive renovation program.

Following these major changes, the hotels were able to capture their full potential, according to Stephen Alden, CEO of The Dedica Anthology. He added that they’re now better suited for the rapidly changing luxury hotel market that is seeing an increasing demand from travelers with a more Millennial mindset.