ECHO accelerates closing of its Inception Fund with Institutional Anchor Investors
Pfäffikon, 20 November 2019 – ECHO Partners AG („ECHO Partners“) announced today the final closing of its inception fund, ECHO Fund SCSp (“ECHO Fund”), through its second closing that occurred on 6 November 2019. The total fund size of ECHO Fund is approx. EUR 152 million.
Successful Closing of ECHO Inception Fund
Following the first fund closing in July 2019 and the acquisition of three hotels shortly thereafter, ECHO Fund was able to accelerate its successful fundraising process and close the fund above the envisaged target size and ahead of the year end closing target. Several institutional banks, pension funds and strategic family offices have subscribed to the Inception Fund supporting the institutional scalability of ECHO’s strategy. The Founders and employees of ECHO Partners have subscribed to more than 10% of the Fund with own capital commitments serving as cornerstone to the Fund.
ECHO Hotel Portfolio well on Track
ECHO Fund’s portfolio currently includes one hotel in Vienna, two hotels in Budapest and the recently acquired hotel Ammonite in Amsterdam. With these acquisitions and one further hotel acquisition targeted for early December 2019 the Fund has invested around 50% of its volume. The average gross acquisition yield of the first four hotels is clearly above 5% offering our investors a locked-in equity yield in the 8-10% range while leaving significant upside through further value increase. ECHO plans to acquire a further 3-5 hotels during the remainder of the fourth quarter 2019 and first half of 2020 and hence completing the investment period.
Dr. Roland Rausch, Founding Partner, states: “This is the first fund that we have set up to serve a dedicated investor base with direct access to yielding core hotels in the fastest growing tourism cities in Continental Europe. The Founders and employees of ECHO Partners have invested more than 10% of the Fund and we were able to convince various large institutional investors and strategic investors to invest in our Inception Fund. I would like to thank all our investors and partners for their support and trust in the ECHO team. Due to the continued strong investor demand for our strategy, ECHO is working on establishing a second, more scalable fund in mid-2020.”
About ECHO Partners AG
ECHO Partners AG (“ECHO Partners”), based in Pfäffikon, Switzerland, invests in hotels, which are located in leading Continental European tourist destinations, such as Vienna, Amsterdam or Budapest and relies on long-term tourism trends. We are identifying and purchasing hotels with a purchase price in the EUR 10-70 million range and a target acquisition yield at or above 5%. The ECHO Fund is the first investment fund of ECHO Partners to implement this strategy.