Fattal surpasses €1.5 billion in European deals

LONDON - Fattal European Partnership, the Israeli hotel group’s European investment arm, has closed on its 12-hotel deal for the Zein Hotel Group in the Netherlands to become one of the biggest hotel companies in the Benelux with 28. It also serves as a testament to the group’s dealmaking prowess in Europe as since it was launched in 2022 more than €1.5 billion in deal volume has been created with more than 6,000 upscale rooms added to the group.

Fattal’s Leonardo Hotel Group for Europe has now closed 40 hotel acquisitions in Europe over the past 24 months and continues to look for new opportunities as the investment group deploys a €420 million Fund III. The Zein deal serves as the eight deal for Fund III after Fund II acquired 19 hotels across Europe for approximately €850 million.

Yaniv Amzaleg, M&A director of Fattal Hotels and co-managing directors of Fattal European Partnerships, told Hotel Investment Today that they have a strong pipeline ahead “with a few exclusivities that are being checked now. We are always looking to add more hotels/portfolios to meet our expansion targets.”

Amzaleg added that European portfolio is now “substantial and counts for about 80% of our business. The YTD figures are in line with what we budgeted.”

Forecasting high double-digit IRR returns for Fund II, Amzaleg also said the first closing of Fund III was in January 2023 and that all funds should be deployed by mid-2025.

“Fattal is a very strong operator across Europe and that is the key driver, in addition, to the alignment of interest between Fattal that has a material LP stake as an investor in each of the funds,” Amzaleg said. “Also, doing the management of the hotels is the perfect formula for our investors. We have a very strong M&A team and our ability to underwrite a transaction is very good. The fact that all of our investors in Fund II participate in Fund III says a lot.”

Worldwide, Fattal Hotels owns and operates more than 300 hotels across more than 120 destinations worldwide, encompassing over 50,000 rooms. With a presence in 21 countries, including Germany, the U.K. and Ireland, Poland, Israel, Spain, the Netherlands, Austria, Italy, Greece, Cyprus, and France, the group continues to expand its global footprint.

Deal roundup

Over the past two years, the European investment arm and Leonardo Hotels have made significant acquisitions, including notable properties in the U.K. such as The Dilly in London, The Grand Hotel in Brighton, and the recently closed Hotel Gotham in Manchester.

Our strategy is to buy the properties and implement our acquisition strategy (create more rooms, renovation, increase margins, etc.). Only then we will evaluate disposals. We look long term when we buy properties, and it takes time to implement this vision.

Yaniv Amzaleg

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In Ireland, the group opened its first NYX hotel in Dublin and recently closed on its acquisition of the g Hotel in Galway and the Hard Rock Hotel Dublin, which will become a NYX hotel and its eight hotel in Ireland.

In Scotland, the group is extending the Leonardo Royal Hotel in Edinburgh by 100 rooms, taking it to 286, and will soon open a 125-room property next door, which will become a NYX hotel.

In Italy, the group acquired Hotel Cicerone Rome, which is set to undergo renovations and reemerge as NYX Hotel Rome by Leonardo Hotels, its eight property in Italy.

In Paris, the group acquired the Prelude Opera Hotel, marking its first hotel in France.  In Austria, Leonardo Hotels became one of the largest hotel chains in the region following the opening of the eight hotels it acquired toward the end of 2023. In Spain, the group acquired four landmark hotels in beachfront locations on the islands of Ibiza and Mallorca totaling 1,119 rooms. It also took over two hotels in San Sebastian earlier this year.

More recently, Leonardo Hotels signed a deal for its fourth hotel in Madrid. Set to open in the second half of 2026, the Leonardo Hotel Madrid Valdebebas will be located just a few minutes from Madrid Airport and Real Madrid Football Club.

Additional acquisitions include a luxury hotel in Limassol, Cyprus, under the Limited Edition concept; a new hotel to enhance the existing Leonardo Royal Warsaw in Poland; and a new NYX development in Brno, Czech Republic, slated for completion in 2028.

Furthermore, in Germany, The Sir Nikolai Hotel in Hamburg will become the first Leonardo Limited Edition hotel in Germany and the fifth brand in the German market. The group also took over the Penta Hotel Köpenick, which will become its first NYX in Berlin.

As for dispositions, Amzaleg said the group is not planning any disposal in the near term. “Our strategy is to buy the properties and implement our acquisition strategy (create more rooms, renovation, increase margins, etc.),” he said. “Only then we will evaluate disposals. We look long term when we buy properties, and it takes time to implement this vision.”