Overview

Altera Holdings structured a EUR 10.6 million blended debt-equity facility for a boutique hospitality group operating a portfolio of hotels and mixed-use assets across Greece and Austria. The facility was designed to support the acquisition, refurbishment, and operational stabilisation of five properties spanning iconic island, coastal, and European city locations.

Investment Rationale

The investee presented a curated portfolio of high-quality hospitality assets in premium tourist destinations, including Santorini, Mykonos, Athens, and Vienna. Altera Holdings identified strong underlying asset value, a credible operating team, and favourable market tailwinds in Mediterranean and European leisure travel. The blended structure allowed the firm to capture both yield on the debt component and equity upside as the portfolio was stabilised and revalued.

Transaction Structure

The EUR 10.6 million facility was structured as a combination of debt and equity, with the split determined by enterprise valuation. The debt component carries a 1:1.3 LTV collateral requirement against the properties financed.

Debt Component

• Interest rate of 6.5–8.5% per annum on a reducing balance
• 7-year tenor with a 1-year moratorium
• 72 equal monthly instalments commencing from month 13
• First tranche of EUR 3.5M disbursed at financial close
• Subsequent tranches disbursed based on borrower request

Fund Utilisation

• Super Market: EUR 4.0M
• Hotel: EUR 1.2M
• Boutique Hotel (Athens area): EUR 1.45M
• Suites: EUR 0.35M
• Hotel: EUR 3.6M

Equity Component

• IPO rights vested with Altera Holdings
• Buyback option available from year 3
• Returns above 18% IRR shared equally through year 5
• If no buyback, IPO triggered at end of year 5
• Investee may alternatively appoint a replacement investor

Security & Governance

Security included a 1:1.3 LTV collateral package, full pledge of shares, hypothecation of free cash flows, post-dated cheques for principal and interest, and comprehensive risk insurance. A corporate guarantee was provided by the investee. Altera Holdings retained board nomination rights and engaged certified valuators for ongoing asset valuation and monitoring.

Key Highlights

• Premium Asset Portfolio: Five properties across Santorini, Mykonos, Athens, and Vienna.
• Hospitality Sector Entry: Expansion into European leisure and hospitality markets.
• IPO Exit Pathway: Defined institutional exit route alongside buyback option.
• EUR-Denominated Facility: Alignment with revenue currency and reduced FX exposure.
• True Moratorium: 12-month repayment buffer for stabilisation phase.

This case study is for illustrative purposes only. Names and identifying details have been anonymised to preserve confidentiality.