GESCO T1 Ltd. announces their first series of Investment Notes focusing on distressed hotels under COVID-19.
Online PR News – 28-April-2021 – London, LDN – GESCO T1 Ltd. has announced the release of its first series of securitized notes focusing on hotel and resort acquisitions following the coronavirus pandemic in Southern Europe.
Designed as a low risk, medium return, fixed income, collateralized investment, GESCO T1 Ltd.’s impact approach will create jobs as well as increase revenue in areas where the coronavirus pandemic has caused financial devastation since early 2020.
According to Mr. Øyvind Berger, Director of GESCO T1 Ltd., “Prior to the pandemic, guests would see hotels at 90-95% occupancy as assume the property was doing well financially. However, rates subjugated by tour operators meant that a seemingly full hotel was only realizing €30-50 per guest per night. For many properties, the only way they could increase profitability was to build more rooms, which is financially unsustainable.”
Mr. Berger continued, “We are receiving hundreds of properties per week, often the same properties from multiple brokers, with the volume of available properties increasing exponentially month to month – and more importantly the discounts are increasing, too. We can be quite discerning, which should give investors greater peace of mind, knowing that each property has gone through a rigorous selection process and that each acquisition occurs on our terms, not those set by brokers and agents. Given the inventory on the market, it is easy to simply say no to a deal and walk away if the terms are not to our liking.”
GESCO T1 Ltd.’s Chief Investment Officer added, “Our focus at both the holding and property levels will be direct booking requirements that most independently owned hotels and resorts in these seasonal regions are not able to accommodate. Domestic travelers, who constitute the vast majority of guests in the current market environment, do not use all-inclusive package tour operators. Properties expecting tour operators to simply send them bookings are in for a difficult year; there is a huge shift towards sales and marketing that most properties are unable to fulfill. And this is an area where we can implement holistic changes, as well as ever-evolving technology, not to mention expertise, to reduce costs and dependence on third parties.”
He went on to say, “Of course there is pent-up demand, but the reality is that bookings do not equal revenue, cancellation rates are high, restrictions are unpredictable at best, overall traveler anxiety continues, the global vaccine rollout has been suboptimal, and even the US placed most EU destinations on its ‘Do Not Travel’ list just last week only to reverse days later for those who are fully vaccinated. While everyone is hopeful 2021 will be better than 2020, if you remove emotion, there is no fact-based evidence to support that assumption. That is why we believe this investment strategy is timed perfectly.”
The private placement note series, GPP Euro Resort Impact Stability (ISIN CH0549200217), has an initial volume of €250 million, and is available to both qualified and institutional investors. With a focus on the acquisition of distressed and discounted hotel and resort properties in Spain, Italy, Croatia, and Greece, the notes are five-year, fixed coupon Secured Bearer Debenture Bonds offering a 4-10% annual coupon, which equates to a 20-50% total return on investment upon exit.
GESCO T1 Ltd. is a UK-domiciled SPV focused on hotel and resort acquisitions with representatives across Europe and in North America. For more information or to obtain a term sheet, please visit http://www.gesco.capital.