French real estate investment trust Covivio has partnered with investment firm Invest Hospitality to acquire four hotels in Milan for €217 million ($256 million).
Covivio, which has interests in several real estate classes, said in a news release its share of the acquisition price is €115 million.
The hotels were not individually named in the announcement, but the portfolio consists of 900 rooms in Milan 1, the official designation of the city’s historical center, in the areas and streets of Bicocca, Scalo Farini, Corso Buenos Aires and Piazzale Loreto.
The deal is a sale-and-leaseback transaction, and Invest Hospitality will continue to operate the hotels, each of which has a 21-year lease.
The partners said the agreements for the four hotels “provide for a minimum guaranteed rent and a variable component linked to the hotels’ revenues. This acquisition offers a guaranteed minimum rental yield of 6% and a target yield, including variable rent, of approximately 7%.”
In January, Covivio acquired the Meininger Hotel Porto — a proposed hybrid hotel-hostel property — for €31.6 million from developer Eiffage Immobilier Portugal. The property is due to open with 228 rooms and 834 beds in the second half of 2028.