Orco said that it will open its new hotel Riva at the Hvar Island in Croatia on Saturday June 24. The hotel was refurbished (previous hotel Slavija) and now offers 56 rooms and 8 apartments. Orco bought Hvar’s hotel portfolio at the end of the last year. The portfolio contains nine hotels and the total number of available rooms stands at about 1,120. As the reconstruction plans were known before, we believe that news is neutral for today’s trading with Orco.
Separately, Viterra, earlier acquired by Orco, was given the permission to build as sky tower office building in Dusseldorf. We believe the total net office floor will reach 3.2k sqm with an average rent of EUR15/sqm/month. We see the average yield in Dusseldorf to be at c6%. While we see the news as positive and shows that Orco’s projects are on track, we do not expect the news to have any substantial impact on today’s trading. Nevertheless, we reiterate our Buy recommendation and fair value of EUR 113 giving an upside of 46%.