Extendam looks back over 2021

An extraordinary year, in more ways than one…

In 2021, Extendam was highly active in terms of both investment and divestiture. The third-party asset manager completed 22 transactions during the year, acquiring 36 hotels with an overall asset value of almost €490 million, including 5 hotels outside France.

Extendam has a portfolio of 268 hotels (21,093 rooms) in France and Europe, with an asset value of €2.7 billion as of 31 December 2021, shoring up its position as leading private equity player for the hotel industry in Europe.

All acquisitions involve economy and mid-range hotels, which is both the largest and most resilient segment in the hotel industry. Extendam spearheaded France’s principal hotel transaction in this segment in 2021, with the acquisition of the SCSP Hotels portfolio located mainly in Lyon, Chalon and Geneva.

The year was also characterised by six divestitures involving eight hotels and representing almost €170 million in asset value. These divestitures generated between 1.4 and 2.2 times the initial investment and an average IRR of 10% despite the health crisis.

“2021 was an extraordinary year in more ways than one. Firstly, a year still marked by the health crisis cannot really be called an ordinary year. In keeping with 2020, many players were still on the lookout for bargains (investments in times of crisis generally prove to be excellent), with a view to entering the market. However, only a rare few succeeded in seizing the opportunities on offer, because the others were either unable to identify them on time or were too dependent on the highly competitive intermediated-transaction market. In this respect, 22 investments seems extraordinary indeed! But we owe this result to our position as a pure player in hotel investment and to the work that our investment team has been carrying out for the last ten years – work that also enables us to play an active role in our own deal flow,” explains Jean-Marc Palhon, Chairman of Extendam.

A year rich in new partnerships…

Extendam has chosen to focus on transactions involving hotels operated by hotel industry professionals, truly independent industrial groups who are able to act as co-investors with a view to aligning interests. In 2021, Extendam entered into five new partnerships with long-standing industry professionals meaning that it now has close ties with 56 of the 100 largest independent hotel groups in Europe.

“2021 was a year rich in new partnerships. We are very pleased about this because these close ties with top European hotel industry players combined with our active contribution to hotel asset management represent a major competitive advantage, helping us to stand out from the crowd. This allows us to be as true as possible to our investments and make the best decisions possible alongside our hotel-industry partners. This model, which we intend to pursue and consolidate in the years to come, also guarantees a diversified and well-structured roll-out of our investments in Europe.”

Bertrand Pullès, Managing Director of Extendam