KKR and Baupost Team Up for Strategic Hotel Investment

KKR and Baupost's Strategic Acquisition of Marriott Hotels

In an exciting development in the hotel investment sector, leading investment firms KKR and The Baupost Group have announced a joint venture to acquire an impressive portfolio of 33 Marriott International hotels located throughout the UK. This acquisition underscores KKR's strategic focus on the hospitality sector, working in collaboration with the Abu Dhabi Investment Authority (ADIA) through a subsidiary.

Details of the Hotel Portfolio

The newly acquired portfolio comprises 33 full-service hotels that carry the Marriott and Delta by Marriott brands. These properties are spread across major cities, including London, Edinburgh, Glasgow, Leeds, and Liverpool. With about 6,500 hotel keys, this collection benefits from extensive renovations, enhancing the atmosphere for both business and leisure travelers.

The Offerings of the Properties

The hotels in this portfolio offer a variety of amenities aimed at catering to the diverse needs of guests. From modern conference and event facilities to recreational options such as golf, these properties are well-equipped to provide exceptional experiences for visitors.

Leadership Insights

Mai-Lan de Marcilly, the Managing Director and Head of Transactions France and Hotels at KKR, highlighted the strategic nature of this investment: "Our acquisition of this remarkable portfolio illustrates our strong belief in the UK market and the potential for long-term growth within the European hospitality sector." This acquisition marks KKR's second collaboration with Marriott International in Europe, positioning them as a leading entity in owning premium Marriott hotels across EMEA.

Collaboration with Amante Capital

The joint venture will be managed by Amante Capital, KKR’s dedicated hospitality platform, which will collaborate closely with Marriott International to enhance the operation of the portfolio. The expertise of Amante Capital's team will ensure continued investment and exceptional service at each property, supporting local teams in delivering outstanding guest experiences.

KKR's Long-Term Investment Strategy

KKR has demonstrated its commitment to the UK real estate market with an investment history that exceeds US$3.5 billion since 2016. This investment spans various sectors, including hospitality, residential, student housing, and logistics. KKR's approach focuses on value-add and opportunistic strategies within the European real estate landscape, aiming to generate rewarding returns.

Legal and Financial Advisors

A robust team of legal advisors, including DLA Piper, Ropes & Gray, and Simpson Thacher Bartlett, guided the KKR and Baupost joint venture during this transaction. Financing was arranged through the KKR Capital Markets team and Eastdil Secured. Support and advisory roles were also provided by Hamilton Pyramid and Burges Salmon for ADIA.

About Amante Capital

Amante Capital, founded in 2022, focuses on hotel real estate investments throughout Europe. With over 25 years of combined experience among its team members, Amante Capital is well-equipped to drive significant growth. Their goal is to build a comprehensive hotel investment platform across Europe.

About KKR

As a leading global investment firm, KKR provides alternative asset management and insurance solutions while adhering to a disciplined investment approach. With funds that span private equity, real assets, and credit, KKR is dedicated to cultivating growth within its portfolio companies while serving various institutional and private clients.

About The Baupost Group

Founded in Boston in 1982, The Baupost Group employs a value-oriented investment philosophy. CEO Seth Klarman has guided the firm since its inception, focusing on long-term investments across numerous asset classes, including real estate. Baupost’s extensive experience and relationships in the real estate sector enhance their capability to navigate complex investment opportunities.

Frequently Asked Questions

1. What did KKR and Baupost acquire?

KKR and Baupost acquired a portfolio of 33 Marriott International hotels across the UK.

2. Who will manage the newly acquired portfolio?

The portfolio will be managed by Amante Capital, a hospitality platform under KKR.

3. How does this acquisition benefit KKR?

This acquisition aligns with KKR’s strategic goal to expand its presence in the European hospitality market.

4. What brands are included in the hotel portfolio?

The portfolio consists of properties branded as Marriott and Delta by Marriott.

5. Why is this acquisition significant for Baupost?

This acquisition represents Baupost’s focus on investing in high-quality assets within key markets.

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