Thomas Cook has created a £150 million ($208 million) fund with Swiss-based property developer LMEY Investments to boost its in-house hotels portfolio. The 50-50 joint venture will initially involve five assets in Greece and Spain.
7 March 2018--Thomas Cook Group, one of the world's leading holiday companies, today announces the launch of its hotel fund - Thomas Cook Hotel Investments - a joint venture with Swiss-based hotel property development company, LMEY Investments.
Thomas Cook Hotel Investments will consist of five seed hotel assets worth around £150 million, and will help to accelerate Thomas Cook's growth of its own-brand hotel portfolio. The partnership combines Thomas Cook's distribution network and expertise in managing hotels, with LMEY's track record in identifying and refurbishing hotels. The joint venture will be 50/50 owned by Thomas Cook and LMEY.
Thomas Cook Hotel Investments will focus on acquiring hotel properties across Thomas Cook's key destination markets, to expand its portfolio of own-brand hotels, leveraging the addition of third-party capital over time. It will provide Thomas Cook customers with an even greater choice of own-brand hotels that are unique to Thomas Cook, which achieve higher levels of customer satisfaction and better margins than the portfolio average.
The five seed assets include two Thomas Cook hotels, the long-standing family resort Sunwing Kallithea in Rhodes and the well-established Sunwing Makrigialos in Crete. LMEY has agreed to contribute three hotels, including two Aldiana-branded hotels in Spain, one in Andalucia and the other in Alcadesia. The third property will be the investment vehicle's first joint project - the development of a fifth Casa Cook - the award-winning boutique lifestyle brand.
This fifth Casa Cook, the first in Spain, will open in Ibiza in Summer 2019, transforming an existing property combined with an adjacent plot of land into a stunning 200-room hotel. The Ibiza plot lies in the tranquil bay of Cala Gracio, a short distance from San Antonio, whose legendary sunsets and world-famous clubs make it an ever-popular spot on the White Isle for holidaymakers.
Since opening its first hotel in Rhodes two years ago, Casa Cook has won accolades for its design credentials, and has attracted new customers to the holiday company. Following the Rhodes opening, Casa Cook opened its second hotel on Kos last summer, with more than two-thirds of bookings from people new to Thomas Cook. The third Casa Cook will open this summer on the Greek island of Crete, the first of the collection's hotels dedicated to families. The fourth, in Brela, Croatia, restoring a well-known classic 60s hotel, will open in 2019.
Casa Cook Kos was recently ranked in Travel & Leisure's "It List" as one of the hottest new openings and Conde Nast Traveller included it as the first in its Editor's List of favourite affordable new hotels in Europe.
Ingo Burmester, Thomas Cook's Chief Hotels Officer, said: "With the customer at the heart of our business, providing a high-quality own-brand hotel portfolio is integral to the success of Thomas Cook. The new hotel fund has been an objective for some time. We are now able to accelerate our plan to acquire established properties in popular destinations for us to transform into own-brand hotels. We are in discussions with several hoteliers across the Mediterranean and envisage announcing further projects over the coming months.
"Delivering some of the highest customer satisfaction scores in the business and attracting a new generation of customers to Thomas Cook, Casa Cook is a key pillar in our own-brand hotel strategy. I'm particularly excited to be working with LMEY to develop our first Casa Cook in Spain - and in Ibiza, the perfect destination for the Casa Cook customer who looks for a beach retreat to match their urban lifestyle."
Casa Cook is one of Thomas Cook's seven own hotel brands which include the premium family resorts of Sunwing and the adult-only retreats of Sunprime, as well as Aldiana, the premium club and activity-focused hotel group.
The gross assets and profit before tax of the two Thomas Cook hotels transferred into the joint venture were £63.5 million and £4.8 million respectively, as at 30 September 2017. The legal ownership of the seed assets will transfer to the fund on its completion later this month, following the satisfaction of the remaining completion conditions.
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