Acquisition of hotel in Vilnius Naujamiestis district completed | Newsec

Acquisition of hotel in Vilnius Naujamiestis district completed

Acquisition of hotel in Vilnius Naujamiestis district completed

Property developer Homa Group has acquired the building of the former Simple Plus hotel, at T. Ševčenkos St. 21 in Vilnius, from real estate investment manager Capital Mill. The size of the transaction is confidential. Newsec in the Baltics advised the seller in the transaction.

The property in Naujamiestis district of the Lithuanian capital has a gross leasable area of nearly 2,000 square metres. Previously an administrative facility, used for offices, the building was later converted into a hotel. The hotel also has 35 parking spaces. The property – 4.4 km from the airport and just 2 km from the bus and train stations and the old town – is at a strategically convenient location that is attracting the attention of developers of commercial and residential projects as well as high net worth individuals.

The transaction relates to Capital Mill’s strategy of renewing its portfolio of real estate holdings by investing in larger-scale projects in the three Baltic States. “We see all the Baltic countries as rapidly developing and competitive, therefore the market remains attractive for acquiring and developing commercial properties,” says Capital Mill Partner Marko Kull.

“This property drew a lot of interest from private investors and local real estate developers. With the number of free land plots in central areas of the city decreasing fast, conversion projects are becoming highly popular and desirable on the market,” says Andrius Švolka, Head of Transactions at Newsec in the Baltics.

According to the Newsec expert, the property, which is near the city centre (1.5 km) and not far from the central business district (about 3 km), could be converted into a higher-class hotel, office or residential space. Installing loft-type housing could increase floorspace by about 12 percent and guarantee a bigger investment return.

Speaking about the hotel transactions market, Švolka predicts that larger hotel chains will withstand the crisis, but more and more small hotels can be expected to be put up for sale. And it is precisely smaller hotels that most interest investors, as their location and size are often well-suited for reconstruction into residential or office buildings.

Fort Legal served as Capital Mill’s legal advisor in the transaction.


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