KKR-Baupost Group JV Buy 33 Marriott International Hotels

Leading investment firms KKR and The Baupost Group have formed a joint venture to purchase a portfolio of 33 Marriott International hotels across the UK from a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA).

Amante Capital, KKR’s vertically integrated European hospitality platform, will serve as managing partner for the joint venture and the properties will continue as premium Marriott branded hotels, KKR said.

The value of the deal was not disclosed by either parties but is reported be around price paid has not been disclosed but is understood to be around $1.14 billion. ADIA acquired the portfolio of 47 Marriott Hotels from Royal Bank of Scotland for $809.26 million in 2013.

The portfolio consists of 33 full-service properties branded as Marriott and Delta by Marriott in London and prime regional cities including Edinburgh, Glasgow, Leeds and Liverpool. The 6,500 key portfolio benefits from recent high-quality refurbishments and features an attractive mix of amenities catering to business and leisure guests, ranging from conference and event venues to golf and recreation.

Mai-Lan de Marcilly, Managing Director and Head of Transactions France and Hotels at KKR said that the purchase of this impressive portfolio reflected their conviction in the UK and the opportunity they see to invest behind strong fundamentals and long-term growth in the European hospitality sector.

“With Amante Capital we have built the capabilities to be a scaled acquirer and operator of premium hotels across Europe. This is our second investment with Marriott International in Europe and expands our global relationship as well as making us the largest owner of premium segment Marriott International hotels in EMEA,” Marcilly added.

Nick Azrack, Partner at the Baupost Group, said that this venture highlighted his company’s continued opportunistic approach to investing in high-quality assets and they were excited to collaborate with Amante, KKR and Marriott International on the future of these hotels.

Milestone Acquisition

Amante Capital’s experienced team will manage the portfolio on behalf of the joint venture. Working closely with the Marriott International’s UK team, Amante will oversee a program of continued capital investment and provide dedicated services to support the local teams at each property in attracting business and delivering exceptional guest experiences. To own this collection of premium hotels is a milestone acquisition for Amante Capital and its investment partners.

KKR has been a long-term investor in UK real estate, having deployed over $3.5 billion of capital since 2016 across hospitality, residential, student housing and logistics properties. KKR is making the investment primarily through its value-add and opportunistic European real estate strategy.

DLA Piper, Ropes & Gray and Simpson Thacher Bartlett served as legal advisors to the KKR and Baupost joint venture. KKR Capital Markets and Eastdil Secured arranged financing for the transaction. Hamilton Pyramid served as asset manager, Eastdil Secured as advisor and Burges Salmon as legal counsel to ADIA.

Founded in 2022, Amante Capital is dedicated to investing in hotel real estate across Europe. Over the last 25 years, the team at Amante has been involved in origination, transactions, asset management, capex deployment and operations of a multitude of single assets and portfolios.