London-based private equity firm Proprium Capital Partners has sold its 35% stake in Munich-based Motel One Group for €1.25 billion ($1.36 billion) to the hotel firm’s majority partner One Hotels & Resorts GmbH.
One Hotels & Resorts is the founding entity of Motel One, but Proprium has been its partner for the last 17 years. The deal closed on April 2 and values Motel One at €4.17 billion ($4.5 billion).
Proprium bought its stake in Motel One Group in 2007 for €65 million, according to a news release. It recapitalized its investment five years ago.
Philipp Westermann, partner and head of Europe at Proprium, said his company was glad to be a part of Motel One's growth for so long.
“Motel One has delivered outstanding profitable growth since inception by combining a unique design-led hotel concept, a disciplined and cash-generative business model and an entrepreneurial culture,” Westermann said in a news release. “While the sale of our stake in Motel One will generate very attractive returns for our investors, we leave Motel One very well-positioned with an enormous potential for future growth. The investment in Motel One exemplifies Proprium’s commitment to platform investing, aimed at delivering outsized private equity returns within the real estate industry.”
Motel One currently has 94 hotels and 26,470 rooms open, along with a pipeline of 23 hotels with approximately another 5,500 rooms. In January, Motel One said it planned to open an additional 13 hotels before 2026. If all open, Motel One will have a presence in 56 European cities.
In the second half of 2024, the company plans to open a second property in London, the Motel One London Hyde Park. The United Kingdom capital will get a third Motel One property by the end of the year in the Old Street area close to Shoreditch.
In 2022, Motel One Group launched its second brand, Cloud One Hotels. In November 2022, it opened The Cloud One New York-Downtown, a 326-room, 28-floor property in New York City. The Cloud One brand also has two hotels in Germany, one in Hamburg and the other in Nuremberg.