Aspen Properties and its partner will buy a hotel and clinics for €6 million.
Aspen Building and Development Ltd. (TASE:ASBD) subsidiary Aspen Properties (1990) Ltd. (TASE:ASBT) has signed an memorandum of understanding (MOU) to acquire half of two projects in Germany’s Black Forest from the Economic Corporation for the Development the Establishment of Contractors and Buildings in Israel Ltd. for €6 million (NIS 34 million). Aspen Properties will also bear half of the expenses of the projects up to €200,000.
The properties are clinics and a hotel with 25,000 square meters of built-up space on a 21.75-acre lot. The properties will be leased to their current operator for 9.5 years. The properties will generate net operating income of €1.05 million a year, of which Aspen Properties’ share will be €525,000, giving a return on investment of 8.5%. The land also has thousands of square meters in unexploited building rights for residences and recreational use.
Aspen Properties is responsible for securing financing for the purchase of the properties. In the event that the Economic Corporation is unable to obtain its share of the financing, Aspen will provide it with a €1.5 million loan at 7% annual interest, and will have priority rights for repayment before the distribution of profits from the project.
Published by Globes [online], Israel business news - www.globes.co.il - on September 17, 2007
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