Deal with Two Tallinn Hotels Sends a Positive Signal to Foreign Investors
Expert: transaction with two Tallinn hotels sends a good signal to foreign investors
The sale of hotels L'Ermitage and L'Embitu located in central Tallinn and their joining of the global hotel chain Accor sends a fresh positive message to foreign investors about Estonia's business environment, emphasized Mihkel Pärtel, leading partner of 1Partner Advisory, which advised on the transaction.
"A transaction of this scale in the hotel sector stands out not only in Estonia, but also across the entire Baltic region. While the commercial real estate market has been quite quiet over the past six months, the old truth still holds that good goods always find a buyer," commented the leading partner of 1Partner Advisory.
"Accor's strong presence in Estonia brings healthy competition to the market and increases foreign investors' interest in the entire region. The hotel industry, and the tourism sector more broadly, has come through several consecutive crises and remains attractive to investors," said Mihkel Pärtel.
Following the transaction, the buildings of L'Ermitage and L'Embitu hotels will belong to businessmen associated with the Estonian construction company Hausers, but from June 1st, the hotels will join the portfolio of one of the world's largest hotel groups, Accor, expanding the group's network in Estonia and the region. L'Ermitage and L'Embitu hotels will be operated by Estonian company Duco Hotels, whose team includes professionals with international experience in their field. Duco Hotels will also continue to operate the 190-room Ibis Tallinn Center hotel, which opened in 2019, built and previously operated by the same entrepreneurs.
"L'Embitu is a true gem in Estonia's hotel landscape and you can feel that this hotel was created with heart. L'Ermitage is a well-established hotel, but we would like to change its concept somewhat in the future to make it more interesting and distinctive. Both hotels have great potential under Duco Hotels' management, and despite the current turbulent times in the real estate market, we feel comfortable with this purchase," commented Madis Mägi, one of the new owners.
Hotel L'Embitu is a 125-room four-star hotel built on Lembitu Street in 2020. L'Ermitage hotel is located on Toompuiestee and began welcoming guests in 2004. It is also a four-star hotel, the building was last renovated in 2014 and has 122 rooms.
1Partner Advisory is a company belonging to 1Partner Real Estate Group that provides commercial real estate investment consulting in the Baltics. Among other things, the company's services include transaction advisory, asset management, property valuation, strategic consulting and representation of owners or tenants.
1Partner Real Estate Group is the official cooperation partner of JLL (Jones Lang LaSalle), the world's largest commercial real estate consulting company, in the Baltics. 1Partner has offices in Tallinn, Tartu, Riga and Vilnius. 1Partner Group provides real estate brokerage, valuation, construction, development, management and investment management services.
