Hotel Transaction Austria

Steigenberger Hotel Linz, Austria Sold to Trans World Corporation

The 176-room, river-front four-star hotel, which opened in 1995, is approximately 35 minutes driving time from the Company’s Route 55 Casino, located on the Czech-Austrian border near Dolni Dvoriste, Czech Republic, and 2.5 hours driving time from its Hotel Savannah/Route 59 complex, near Znojmo, Czech Republic
Steigenberger Hotel Linz - Exterior
Steigenberger Hotel Linz

Trans World Corporation

Trans World Corporationyesterday announced that on March 1, 2017, through its subsidiaries, Trans World Hotels & Entertainment a.s. and Trans World Hotels Germany GmbH, it purchased the ground lease rights to a four-star business hotel located on the banks of the Danube River in Linz, Austria.

The 176-room, river-front four-star hotel, which opened in 1995, is approximately 35 minutes driving time from the Company’s Route 55 Casino, located on the Czech-Austrian border near Dolni Dvoriste, Czech Republic, and 2.5 hours driving time from its Hotel Savannah/Route 59 complex, near Znojmo, Czech Republic. TWC’s management expects to see economic benefits from synergies that can be developed between the businesses.

The hotel is of particular interest to TWC due to its geographic location near the center of Linz as well as its upside potential. The Company believes the current results will further improve after completion of planned renovations to upgrade the hotel’s style and function. Linz has a greater regional population of 271,000, is an important economic hub in Austria, is an attractive location for business conferences and seminars, and is an important market of the Route 55 Casino.

Mr. Rami Ramadan, Chief Executive Officer of TWC stated, “We are proud to add another hotel property. This is a step forward for TWC in its strategy to grow its hotel and casino portfolio in Europe. We will continue to offer the best possible product and customer service to our clientele and will strive to build on the positive reputation that we have established in the regions in which we operate. This acquisition will also improve the Company’s valuation, to the ultimate benefit of our shareholders.”

In addition to three casinos and the four-star Hotel Savannah in the Czech Republic, TWC currently owns three hotels in Germany: the four-star Hotel Freizeit Auefeld in Hann. Münden; the four-star Hotel Columbus in Seligenstadt, near Frankfurt; and the three-star Hotel Kranichhöhe in Much, near Cologne, which will soon be renovated to four-stars.

Hotel Highlights

The 8-floor, business hotel includes:

  • 176 guest rooms;
  • 120-seat restaurant;
  • 40-seat bar;
  • 6 meeting rooms;
  • a large outdoor terrace overlooking the Danube River; and
  • a spa and fitness center with a sauna, sun beds and a steam bath.

The total acquisition cost was $5.2 million inclusive of the $4.5 million purchase price and the deal structure involved TWC’s acquisition of 100% of the shares of Hotel Donauwelle Betriebsgesellschaft m.b.H. which owned the long-term lease rights through the year 2061. TWC invested $1.1 million as equity and the balance was financed through the assumption of an existing five-year bank loan in the amount of approximately $4.1 million from Erste Bank, Austria, with fixed-interest of 2.95%, paid quarterly. The loan will mature on December 31, 2021, pursuant to which the remaining balance of approximately $2.0 million will be either paid off or financed. TWC plans extensive renovations to the guest rooms, lobby, restaurant, and meeting rooms, which will be conducted in phases over the course of 2017 and 2018.



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