More than 8,000 rooms across the UK, over half of the portfolio located in Greater London, €4.1 billion in real estate assets and a strategy that highlights an often-overlooked principle: in hotel investment, value is created not only by the property itself, but also by the capital structure behind it.
Some investors buy hotels.
Others build financial structures around hotels.
Vivion Investments belongs firmly in the second category.
The Luxembourg-based group reports a real estate portfolio worth approximately €4.1 billion, comprising 109 properties, with a particularly significant exposure to the UK hospitality sector: 53 hotels and more than 8,000 rooms, over half of them located in Greater London.
But the real estate figures tell only half the story.
The other half is about debt, leases, sale-and-leaseback transactions, freeholds, bonds, hybrid capital, refinancing and the separation between ownership and operations.
And it is precisely this second dimension that makes Vivion such a relevant case study for the Italian hotel investment market.
Vivion in six numbers
€4.1 billion
Reported value of the real estate portfolio.
109 properties
Including offices in Germany and hotels in the United Kingdom.
53 hotels
The UK hospitality portfolio.
More than 8,000 rooms
With a significant concentration in Greater London.
€87 million
The new secured financing announced in August 2026.
€42 million
The amount paid to reacquire the freehold of London’s St Martins Lane Hotel, while eliminating a liability recorded at approximately €69 million.
The key point, however, is not scale alone.
It is how that scale is financed.
Vivion is not a hotel operator
The first mistake would be to view Vivion as a traditional hotel company.
It is not.
Vivion is primarily a real estate owner.
Its UK hotel portfolio is fully leased, with an average remaining lease term of approximately ten years.
This means that the financial product held by the group is not simply the hotel.
It is the contractual cash flow generated by the hotel.
That distinction matters.
A hotel operating company lives by occupancy, ADR, RevPAR, GOP, payroll costs, distribution and commercial performance.
A property owner with long-term leases focuses instead on tenant creditworthiness, rent sustainability and the duration of contractual income.
The hotel remains the underlying economic asset.
But what capital markets increasingly finance is the predictability of the income stream attached to it.
That leads to the first important lesson for anyone analysing hotel investments:
a hotel can simultaneously be an operating business, a real estate asset and a financial product.
Failing to distinguish between these three layers often leads to flawed valuations and poor investment decisions.
How to build a multi-billion-euro portfolio: buy when others are forced to sell
A significant part of Vivion’s UK hotel portfolio was assembled between 2018 and 2019.
The strategy was clearly opportunistic.
In 2018, the group acquired a major portfolio of Holiday Inn and Crowne Plaza hotels for approximately £750 million.
In February 2019, it added nine UK Hilton-branded hotels acquired through the Zinc Hotels process for £246 million.
Later that year, Vivion acquired two London design hotels for a consideration in the region of £300 million.
The Zinc transaction is particularly instructive.
In July 2017, the portfolio had reportedly been marketed for approximately £600 million, without finding a buyer.
Following the seller’s entry into administration, Vivion acquired the assets for £246 million.
That is not simply a story about negotiating a discount.
It is a lesson in distressed-market timing.
When a seller has time, it can defend its price.
When it has to sell, the balance of negotiating power changes.
That is why, in distressed transactions, the competitive advantage does not necessarily belong to the investor who understands the hotel better.
It belongs to the investor who already has:
capital, a transaction vehicle, advisers, due diligence capabilities, access to financing and a decision-making process.
Once the opportunity becomes visible to the wider market, starting to get organised often means being too late.
The same dynamic can be seen in NPLs, UTPs, insolvency proceedings and special situations analysed on InvestimentiAlberghieri.it.
Distress is not a permanent asset class. It is a window of opportunity.
St Martins Lane: spending €42 million to eliminate a €69 million liability
The latest stage of Vivion’s strategy is also one of the most interesting.
In August 2026, the group announced a new €87 million secured financing, equivalent to approximately £75 million.
The facility has a five-year maturity, is priced at SONIA + 1.95% and is secured against six hotels in the UK portfolio.
Part of the proceeds was used to reacquire the freehold of the St Martins Lane Hotel in London for approximately €42 million.
This is where the transaction becomes particularly noteworthy.
The freehold had previously been sold as part of a sale-and-leaseback structure.
As of 31 December 2025, Vivion reported a liability of approximately €69 million associated with that arrangement.
Following the freehold acquisition, that liability was removed.
In deliberately simplified terms:
€42 million of cash was used to eliminate a liability of approximately €69 million while simultaneously restoring full ownership of the underlying property.
The economic benefit cannot simply be equated with the arithmetic difference between the two figures.
But the financial logic is clear.
Vivion replaced a previous contractual structure with secured financing that it considered more efficient.
At the same time, it regained full control of the real estate asset.
Sale and leaseback is not free money
This leads to the second major lesson.
A sale-and-leaseback transaction is often presented as an effective way to release capital tied up in real estate without disrupting hotel operations.
That is true.
But it does not create free capital.
Selling the property and continuing to occupy it under a lease simply replaces trapped real estate equity with a stream of future contractual obligations.
The relevant question is therefore not only:
how much capital do I release today?
The right questions are also:
How much will I pay tomorrow?
What is the present value of the future rent?
How long will the lease run?
How will the rent be indexed?
What is the alternative cost of debt?
How will the structure affect a future disposal?
Can the property be repurchased?
How financeable is the leasehold when separated from the freehold?
Sale and leaseback is a tool.
It is not a strategy in itself.
It can create value or destroy it.
The outcome depends on the effective price at which capital is transferred.
The real game is the cost of capital
Anyone looking at Vivion purely through the lens of hotel acquisitions is likely to miss the most interesting part of the story.
In recent years, a significant part of value creation has taken place on the liability side of the balance sheet.
The financing history makes this clear.
In 2019, Vivion entered the capital markets through major bond issuances.
During the pandemic, perceived risk increased sharply.
By 2021, Vivion bonds were among the securities attracting significant short interest in Europe.
A long refinancing cycle followed.
In January 2023, twenty Crowne Plaza and Holiday Inn hotels were refinanced.
In August of the same year, the group completed a refinancing and bond exchange exercise of approximately €1.4 billion, materially extending the maturity profile of its debt.
The price was high:
6.50% plus a PIK component.
By 2025, the picture had changed.
Vivion issued €505 million of senior secured notes due 2030 with a 5.625% coupon and €252.5 million of perpetual hybrid securities paying 8.125%.
In March 2026, existing shareholders also provided a €60 million equity injection.
In June 2026, S&P affirmed the company’s BB issuer rating and BB+ rating on the senior secured debt while revising the outlook to stable.
The trajectory is clear.
The group has been managing maturities, debt costs, equity and collateral simultaneously.
And that points to a principle that remains underestimated in the hotel sector:
liability management is part of hotel investment management.
Not operationally.
Economically.
A one-percentage-point reduction in the cost of €500 million of debt represents €5 million per year.
That is €5 million that does not need to be generated through higher occupancy.
It does not require additional rooms.
It does not require a higher ADR.
It does not require another commercial campaign.
It comes entirely from a more efficient capital structure.
That is why, in acquisition and restructuring assignments discussed on robertonecci.it, the capital structure has to be assessed alongside the hotel business plan.
RevPAR matters. But so does the cost of the capital required to generate it.
OpCo and PropCo: rent can determine the value of the hotel
The Vivion case also provides a useful lens through which to examine another major issue for the future of the Italian hotel market:
the separation between OpCo and PropCo.
The PropCo owns the real estate.
The OpCo operates the hotel business.
Separating the two can create substantial advantages:
greater balance-sheet clarity, access to different sources of financing, the ability to bring in specialised investors, greater corporate flexibility and the option to sell the property and operating business separately.
But it also introduces an equally important issue.
The rent paid by the OpCo is simultaneously a cost for the operator and revenue for the property owner.
When both entities belong to the same group, that rent becomes a critical variable.
In December 2022, Muddy Waters Research published a highly critical report on Vivion.
Among other issues, it challenged certain valuations within the UK portfolio and raised questions around relationships with operating companies classified as related parties.
Vivion publicly rejected the conclusions of the report and argued that its related-party arrangements were appropriately disclosed in its financial documentation.
The purpose here is not to determine which side was right.
The point is the underlying principle.
Suppose a hotel property is valued by capitalising its rent.
If the rent is €5 million, the property has one theoretical value.
If the rent becomes €7 million, the theoretical real estate value increases.
But if landlord and tenant are controlled by the same economic interest, who establishes whether that €7 million genuinely reflects market rent?
That is the vulnerability.
This is why a robust OpCo/PropCo structure requires at least three safeguards:
rent determined against independent market benchmarks;
review mechanisms linked to objective operating or market parameters;
full transparency regarding related-party arrangements.
In the governance and structuring work carried out through Hotel Management Group, these are not merely corporate formalities.
They have a direct impact on bankability, due diligence and exit value.
Five lessons for investors in Italian hotels
1. The contract can be worth as much as the property
Institutional investors do not buy walls alone.
They buy cash flows.
A long, sustainable lease with a financially credible counterparty can represent a substantial part of an asset’s value.
The quality of the contract can therefore matter almost as much as the quality of the building itself.
2. Scale changes which capital markets you can access
With 53 hotels and more than 8,000 rooms, an owner can issue debt in the international capital markets.
With a single independent hotel, financing will generally remain a bilateral relationship with a bank.
This is not about prestige.
It is about structure.
Aggregation makes it possible to diversify risk, standardise reporting, create broader collateral packages and access investors who would never consider an individual hotel asset.
For the Italian market, this is likely to become one of the most important themes of the coming years.
3. In distressed situations, time is part of the price
The Zinc case illustrates the mechanism perfectly.
A portfolio marketed at approximately £600 million was subsequently acquired for £246 million.
The underlying real estate had not necessarily lost value in the same proportion.
What had changed was the seller’s bargaining power.
In distressed transactions, available liquidity and execution speed can be worth more than weeks of price negotiation.
4. Cost of capital is a hotel KPI
A hotel can improve occupancy, ADR and GOP.
But if it is simultaneously paying too much for its debt, part of that operating value creation is simply transferred to the lender.
That is why financial reporting, management control and frameworks such as USALI, discussed in greater depth on InvestHotel.it, are so important.
They do not simply help manage the hotel more effectively.
They make the asset understandable to capital providers.
5. Governance has economic value
Related-party transactions, intercompany financing, management agreements, leases and corporate structures are not secondary details.
They are exactly the issues that a future investor will examine during due diligence.
Opaque assets are discounted.
Transparent assets are easier to finance.
Governance, therefore, is not merely about control.
It is a form of asset value creation.
Why Italy does not yet have its own Vivion
Italy already has almost all the necessary ingredients.
It has one of Europe’s most important hotel property markets.
It has destinations supported by structural international demand.
It has irreplaceable real estate.
It has institutional investors interested in the sector.
It has operators.
It has capital.
It has sufficiently sophisticated corporate and financial tools.
What it still lacks, above all, is the aggregator.
The player capable of turning dozens of individual hotels into a platform.
But doing so requires abandoning an idea that remains deeply rooted in the Italian market:
that ownership and operations must necessarily sit within the same structure.
They do not.
The value of a hotel can be separated into at least four components:
real estate;
contract;
operations;
capital.
Each component can have different investors, different return expectations and different risk profiles.
This is where the Italian market has the opportunity to make a structural leap forward.
To move from investing in individual hotels to building hotel platforms that can be financed, aggregated and ultimately sold as institutional assets.
This is also the logic connecting the investment analysis published by InvestimentiAlberghieri.it, the advisory work developed through robertonecci.it, the financial and management-control expertise of InvestHotel.it, the positioning strategies developed by HotelMarketingLab.it, the operational and governance activities of HotelManagementGroup.it, executive search through VertexExecutiveSearch.it, management education through RobertoNecciAcademy.it and the operating models developed through NecciHotels.it.
Because once a hotel investment reaches institutional scale, finance, operations, people and strategy can no longer be analysed in isolation.
The real lesson from Vivion
Vivion is not a model to be copied blindly.
It lived through the pandemic.
It came under pressure on the debt side.
It had to refinance.
It relied on expensive financing instruments.
It faced public criticism.
It had to strengthen its equity base.
And that is precisely what makes the case valuable.
It shows what managing a hotel portfolio looks like once the business reaches institutional scale.
Distressed acquisitions.
OpCo and PropCo.
Sale and leaseback.
Secured debt.
Bonds.
Hybrid capital.
Equity injections.
Refinancing.
Freehold reacquisitions.
These are not separate transactions.
They are different tools used to manage the same fundamental variable:
the relationship between asset value and the cost of the capital required to control those assets.
The conclusion for hotel investors therefore goes well beyond the Vivion case.
It is not enough to know what a hotel is worth.
You also need to know:
how much cash flow it can generate;
how much debt it can support;
what that debt will cost;
what type of lease or contract it can sustain;
who should own the real estate;
who should operate the business;
and which structure will make the investment saleable tomorrow.
That is the difference between buying a hotel and building a hotel investment.
Are you evaluating a hotel investment?
Buying a hotel at the right price is not enough.
If the financial, corporate or contractual structure is wrong, even a strong asset can become a mediocre investment.
If you are considering the acquisition or sale of a hotel, a hotel portfolio, a distressed transaction, an OpCo/PropCo separation, a debt restructuring, the entry of a new investor or the creation of a hotel investment platform, the right time to structure the transaction is before signing — not afterwards.
To submit a deal or discuss a transaction confidentially, contact r.necci@robertonecci.it.
