The Radisson hotel complex in Bucharest, one of the biggest premium hotel properties in Romania, changed owners after a EUR 169 million deal.

Israeli group Elbit Imaging signed on Wednesday evening, November 29, the contract to sell the Radisson hotel complex to an investment vehicle owned by two international investment funds. The deal was based on a property value of EUR 169.2 million.

Elbit Imaging estimates to get some EUR 81 million net proceeds from this deal, after offsetting bank loans, working capital and other adjustments, as well as transaction expenses. Of this sum, the seller will also grant a EUR 8 million loan to the buyers for a period of 3 years. This loan will also act as collateral for liabilities that may appear after the closing of the transaction.

“The consummation of the transaction, which is expected to occur during the month of December 2017, is subject to the fulfillment of a conditions precedent, namely the obtaining by the Purchaser of externally sourced financing,” reads a statement issued by Elbit Imaging on NASDAQ.

The Israeli group’s sole advisor in this deal was real estate consultancy group JLL, through its London and Bucharest offices.

One of the buyers is the investment fund Revetas Capital, according to the Romanian media. The fund also owns the Vitantis shopping center in Bucharest.

Elbit Imaging entered the local market in the early ‘2000s by acquiring the former hotel Bucuresti, the largest hotel in Bucharest in the Communist period. It invested EUR 70 million in modernizing the hotel, which it re-opened in 2003 under the Radisson brand.

The Radisson complex is located in central Bucharest, on Calea Victoriei. The property includes the five-star Radisson Blu hotel, with a capacity of 487 rooms, the newly renovated four-star Park Inn Hotel, with a capacity of 276 rooms, and 7,200 sqm of commercial area that includes the biggest casino in Bucharest, a fitness center and fashion shops.

The Radisson Blu hotel and the Park Inn hotel are managed by Rezidor, which is part of Carlson Rezidor Hotel Group.

Bucuresti Turism, the company that owns the two hotels, is one of the biggest hotel companies in Romania. It had a turnover of EUR 31.1 million and a net profit of EUR 2.57 million, in 2016, according to official data from the Finance Ministry.

editor@romania-insider.com