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European real estate fund manager Internos has acquired the Hilton Danube hotel in Vienna from Austrian listed property group Immofinanz.

The total investment volume was close to €52 mln.

The Hilton Vienna Danube was opened in 2003 and has 367 rooms, including 24 suites. The lease with the Hilton Group was extended for 20 years in 2011. The building, which overlooks the river Danube, was completely renovated in 2010 and 2011.

The hotel is the seventh asset to be acquired for the Internos Hotel Real Estate Fund in the last 12 months.

Internos said the four-star hotel's profile and location in the capital of Austria - a core eurozone country and target investment region for the fund - fit perfectly with the investment strategy and add to the portfolio’s diversification.

Jochen Schäfer-Suren, managing director of Internos' hotel & leisure division, said: 'This latest acquisition, together with historically low interest rates, secured against very attractive returns and enhanced diversification, further reduce the portfolio’s risk profile and thus improve the quality of the returns. Due to the support of our investors, we have been able to nearly triple the initial equity to a total of €210 mln, which allows us to acquire up to a further €150 mln of hotel acquisitions in the next 6 to 12 months.'

Immofinanz, by contrast, is pulling out of the hotel business, which it has designated as non-core. CEO Eduard Zehetner commented: 'We intend to withdraw completely from the hotel segment and are using the current attractive seller's market. Following the profitable sale of the Grand Hotel Kempinski in St Moritz during February of this year, this latest transaction moves us close to our goal of ending our business in this asset class'.

Jones Lang LaSalle Hotels & Hospitality Group acted as advisor on the transaction.

It is the second time Jones Lang LaSalle has been involved in the sale of the Hilton Vienna Danube. In 2000 the firm sold the hotel on behalf of Skanska to Immofinanz.

Immofinanz’s one remaining hotel asset, the Leonardo Vienna, is also on the market following the completion of renovation work.