Fattal Hotel Chain Raises 848 Million Euros for European Expansion
Translated & summarized from Ice by baba
Fattal Hotel Network has secured 848 million euros in investment commitments from Israeli institutional investors for its third European expansion partnership. The company is contributing 200 million euros, with the remaining funds already used to acquire two hotels in England and France. This latest venture builds on the success of two previous partnerships that raised a total of 1.8 billion euros and acquired dozens of European hotels, demonstrating Fattal's strategy of leveraging institutional capital for opportunistic acquisitions.
The story in 5 lines · by baba
- Fattal Hotel Network secured 848 million euros in investment for European expansion.
- The company's third partnership with Israeli institutions includes a 200 million euro contribution from Fattal.
- The new funds have already been used to acquire two hotels in England and France.
- Fattal's three partnerships have collectively raised approximately 1.8 billion euros.
- Previous partnerships successfully acquired dozens of European hotels with strong returns.
Fattal Hotel Network is significantly expanding its European operations, having secured investment commitments totaling 848 million euros through its third partnership with Israeli institutional investors. The company itself is contributing 200 million euros to this latest venture, with the remaining 648 million euros coming from the institutional partners. This new partnership has already completed its first acquisitions, purchasing two hotels in England and France.
The current partnership, launched in July, initially aimed to raise between 800 and 900 million euros but increased its target to 1 billion euros due to high demand. Among the prominent institutional investors are Menora Mivtachim, Harel, Meitav, The Phoenix, Clal, Migdal, Leumi Partners, Shlomo Insurance, Hachshara, and Analyst.
Cumulatively, Fattal's three partnerships have raised approximately 1.8 billion euros. The success of these ventures is attributed to the opportunities created by the COVID-19 crisis and the high-interest rate environment, which allowed for opportunistic acquisitions. The first partnership, established in April 2022, raised about 381 million euros and acquired 19 hotels across Europe with 3,515 rooms, achieving a 21% internal rate of return (IRR) and distributing 12% in cash.
The second partnership, launched in January 2024, attracted oversubscriptions, raising commitments of around 542 million euros. This partnership acquired over 36 hotels (more than 4,700 rooms) for over 930 million euros, reportedly achieving a 26.5% annual return by the end of 2025, partly due to positive revaluations that pushed asset values above 1 billion euros.
David Fattal's model leverages institutional capital with the company's management expertise, brand, and operational capabilities to acquire and improve assets at opportune prices without taking on risky debt. Europe is Fattal's primary operational theater, with 218 active hotels out of the group's total of 283. The company also pursued direct expansion, acquiring operating rights for 10 hotels in Germany and the Netherlands in August. Fattal has a history of such partnerships, dating back to 2007 with a hotel fund that acquired 18 European hotels.
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