Covivio Invests 217 Million Euros in Four Milan Hotels
Covivio accelerates its expansion in the Italian hotel sector. Through its subsidiary Covivio Hotels, the real estate group has finalized the acquisition of a portfolio of four 4-star hotels in Milan for a total amount of 217 million euros, of which 115 million euros are the group's share.
The four establishments are located in Scalo Farini, Bicocca, Corso Buenos Aires, and Piazzale Loreto, areas well served by public transport. The portfolio offers a total of approximately 900 rooms. The hotels, fully renovated, ensure high quality standards and modern facilities. The assets meet the highest ESG standards aiming for LEED Gold or BREEAM In-Use Very Good certification, and comply with the European taxonomy and CRREM's emission targets by 2030.
Leaseback Operation with Invest Hospitality
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The acquisition was completed through a leaseback operation with Invest Hospitality, which will continue to operate the establishments. The leases, lasting 21 years, provide for a minimum guaranteed rent and a variable component linked to the revenue of the hotels. This structure results in a yield on the minimum guaranteed rent of 6% and a target yield, including the variable rent, of about 7%.
Enhancing Covivio’s Presence in Milan’s Hotel Market
Milan enjoys strong demand in both the business and leisure segments. This acquisition significantly strengthens Covivio's presence in the Italian hotel market, where the group already has a strong foothold in office spaces. Invest Hospitality, through its integrated platform, has built a leading reputation and a solid track record, confirming its position among the top operators in the Milan hotel market.
Covivio confirme son objectif de résultat net récurrent (EPRA Earnings ajusté) par action 2026, en hausse d'environ +4 %
Risks mentioned
Hausse des taux d'intérêt impactant le coût du financement
Incertitudes politiques affectant les marchés d'investissement immobilier
Liquidité limitée sur les marchés de l'investissement immobilier
Opportunities identified
Accélération de la croissance des revenus à périmètre constant à +2,7 %
Pipeline de redéveloppement hôtelier de 12 projets représentant 138 M€ de capex avec rendement moyen attendu de 13 %
Signature de contrats de gestion hôteliers avec Generator et IHG pour transformations bureaux-hôtels
Outlook / guidance
Management commentary: Covivio continues to confirm its 2026 guidance of around 4% growth in recurring net result (adjusted EPRA Earnings) per share.
The information presented in this article is provided for informational purposes only and does not constitute an investment recommendation, an incentive to buy or sell a financial asset, or investment advice. Readers are invited to conduct their own research before making any decision.
Investments in the stock market involve risks, including the risk of capital loss. Past performance of an asset or market is no guarantee of future results. Any investment decision should be made taking into account your personal financial situation, objectives and risk tolerance.
