From AIG to Orco

Orco Property Group, the Central and Eastern European developer and asset manager, has recruited former AIG Global Real Estate hotels executive Keith Lindsay to lead its hospitality group.

Lindsay was AIG's global head of hospitality before joining Orco as chief executive officer of its hospitality arm. Orco created a joint venture hotel fund with AIG in 2006. Prior to AIG, Lindsay worked with the Walt Disney Company and Intercontinental Hotel Group as vice president for European investments. He is relocating from New York to Europe. A spokeswoman said Lindsay would be spending much of his time in Paris and Prague.

Orco concentrates its real estate activities on Central Europe and parts of Eastern Europe, sponsoring several sub-funds under the Endurance Real Estate Fund banner. The fund focuses on offices, retail, residential, industrial, logistics and health care markets. However, it also owns several hotel assets, such as the Pachtuv Palace in Prague, the Hotel Le Regina in Warsaw, the Andrassy Hotel in Budapest and the recently opened Pokrovka Suite Hotel in Moscow. In addition, the firm's portfolio includes nine hotels and resorts in Croatia such as the Amfora Pool and Harbour in Hvar.

Orco said Lindsay would have responsibility for operations of all MaMaison Hotels and apartments as well as the Sunéani Hvar Hotels in Croatia. He is also responsible for the asset management of Orco's properties and new investments.

Lindsay said the hospitality sector in Central Europe offered “tremendous opportunities” as countries within the region expand and complete the integration process in the European Union. Orco had plans to raise around €250 million (€388 million) for a hospitality fund last year, but the vehicle had to be postponed due to lack of demand.

The Endurance Hospitality Fund was launched in June 2007 as an opportunistic vehicle hoping to develop or redevelop assets as well as acquire properties that could be repositioned or improved. At the time of the fund launch, the firm said it would balance lower risk, return investments in capital cities in Central Europe with higher risk, return investments in secondary cities in Central Europe Balkans capital cities, Russia and the coast in Croatia.

Orco is based in Luxembourg but is listed on the Euronext in Paris as well as the stock exchanges of Prague, Warsaw and Budapest. It currently has €2.5 billion in assets under management.

In a statement on May 29, Orco said it had been forced to postpone some sub-funds due to the “international subprime crisis”, which caused delays in closing commitments.

It is currently raising four new sub-funds, Office 2, Health Care, Industrial and Logistics and Infrastructure, with three other sub-funds undergoing an approval process: energy, retail and securities.

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