Courtesy/News Source: hospitalityireland.com

Real estate group Covivio is set to buy a portfolio of European luxury hotels from private equity group Varde, two sources close to the matter have said.

The deal, which should be sealed by the end of the year, is worth approximately €500 million to €600 million, according to one of the sources.

It follows a wave of deals in the European luxury hotels sector, including the purchase of Germany's Steigenberger Hotels by China's Huazhu Group.

Italian Market

Varde bought a portfolio of nine hotels from Italian group Boscolo in 2017. It includes famous properties such as the Grand Hotel dei Dogi in Venice and Palazzo Naiadi in Rome.

Hotel investments are set for a record high this year in Italy, according to industry officials. In the first nine months of 2019, investments in Italian hotels tripled to €2.56 billion compared with a year earlier, real estate services group CBRE said.

The head of Covivio's Italian arm Alexei Dal Pastro told a conference in Milan last week that Covivio was interested in investing in Italian hotels, without giving more details.

Covivio could not immediately be reached for comment on the Varde deal. Varde declined to comment.

French based Covivio has a stake of 42% in Covivio Hotels is specialised in the management and rental of real estate assets.