Holiday parks core for KKR

KKR has agreed to buy holiday park group Roompot for a rumoured €1bn, purchasing the group for its core investments strategy.

Roompot, which owns and operates 33 parks in the Netherlands, Germany and Belgium, said that it was looking to further international growth, driven by domestic tourism.

KKR acquired the company from PAI Partners, where Roompot was stablemates with B&B Hotels. PAI took control of the group in 2016 from Gilde Buy Out Partners, BNP Paribas Fortis, the management of Roompot and the founder Henk van Koeveringe.

PAI said that it had invested in upgrading and expanding its accommodations and opening new parks, developing digital marketing and distribution platform, increased real estate ownership and grown revenue and Ebitda at double digit growth rates. The company now welcomes three million guests and 13 million overnight stays each year, generating revenues of almost €400m.

Jurgen van Cutsem, CEO, Roompot Group, said: "As we change to new ownership we would like to thank PAI, who have been a hugely supportive partner to our team since 2016, and welcome KKR for the next phase. Our focus, as always, will be providing a great service for our leisure customers and third-party providers. We continue to see growing demand from our guests and from our corporate partners due to the leading platform we have put in place, providing a solid foundation to scale the business, also on an international level."

Daan Knottenbelt, partner & head of the Benelux region at KKR, said: "Roompot is already a leading player in the region with a best-in-class management team and a strong recent track record. We see significant further growth potential based on a very strong development pipeline, continued expansion of Roompot's owned assets and new corporate partnerships.

“KKR is investing in Roompot through our Core Investments strategy, which is our pool of capital for longer-term investments, and we look forward to working with Jurgen and his team over the coming years."

Joerg Metzner, director, KKR, added: ”We have been looking for a platform to invest behind in the fragmented European holiday parks market for some time. Our support for Roompot and its management team fits perfectly with our broader investment theme in the leisure space."

The deal came after last year’s sale by Blackstone of a portfolio of seven Center Parcs sites in mainland Europe to German investor Aroundtown for around €1bn. The purchase saw Aroundtown diversify away from its strategy, which has seen it focus on income-generating properties with value-add potential in central locations in top tier cities primarily in Germany and the Netherlands.

All of the sites were operated by Pierre & Vacances. Blackstone bought the resorts in Belgium, the Netherlands and Germany from P&V in 2006 for around €630m, but kept Center Parcs Europe as a separate entity from Center Parcs UK which the private equity group acquired in a separate transaction in the same year.

The largest deal in the sector in recent years was the £1.35bn purchase of Parkdean, the 73-site company by Canadian private equity house Onex Corporation, in 2017. “Parkdean Resorts has built the market-leading affordable holiday park business in the UK, with a strong base of loyal customers in an attractive segment of the domestic holiday market,” said Tony Morgan, a managing director with Onex.

Insight: Staycations, staycations, staycations. And that was before the pandemic, although it you’re looking for a business with better social distancing, you’d be hard pressed to find one better than holiday parks.

Holiday parks tend to be resilient and counter-cyclical. A strong economy and people want to buy their own caravan and holiday home it up. When the purse is stretched, people stay in their own countries and rent caravans.

This deal went through quickly and you can quite imagine that, with summer now looming in Europe, the buyers did not want to miss out on what should be a bounteous holiday period, with no-one at all jetting off long haul. Figures a few days ago from STR showed that cities were out and more regional locations were in.

STR managing director Robin Rossmann said that the the top performing areas around Europe were not the big cities, but regions like the Baltic coast  - with 52% - were outstripping the major gateway cities. In Southern Europe it was the tourist destinations which were seeing occupancy “a proper heartbeat from a leisure perspective”. The heart was certainly beating harder for KKR.