Feanor Capital Partners and Banor Alternative Assets to launch a £500m pan-European hospitality fund

London, December 2023: Feanor Capital Partners and Banor Capital, through Banor Alternative Assets, have formed a joint venture to co-invest in a selection of pan-European hospitality assets, with a view to eventually launching a fund targeting small and mid-sized hotels held in distressed capital structures.

Feanor Capital Partners has initially committed £25 million to co-invest alongside Banor Alternative Assets, which intends to match Feanor's investments in the joint transactions.

Over time, the joint venture aims to assemble a hotel portfolio with a gross asset value of around £500 million, focused on the UK and Southern Europe, with a particular emphasis on Italy.

The strategy targets hotels with multiple demand drivers, branding potential, and clear value-add opportunities, where assets are burdened by distressed capital structures or run by inefficient operators. Many are over-encumbered by debt and capex-starved following the pandemic. Asset business plans focus on stabilising the capital structure, targeted capital expenditure, operational improvement, and rebranding.

The joint venture sources assets off-market through the partners' combined networks and a limited pool of pre-qualified investors, supporting a differentiated investment pipeline.

The opportunity reflects current market conditions: pandemic-era disruption left a backlog of sellers who deferred exits while awaiting stabilisation, while the specialist operational expertise required to run hotels limits competition for mid-market assets. Together, these dynamics create pricing dislocation that specialist hospitality investors are positioned to address as business and leisure travel recover.

ENDS.