The B&B hotels are especially visible and are located near main road arteries while having particularly easy access to road networks. This quality location gives a marked property value to ANF’s portfolio of B&B hotels.

During 2008, the partnership with B&B continued with the acquisition of a hotel at Salon-de-Provence in December. The hotel was purchased for €3.5 million excluding VAT.

The hotel is situated in an area of hotels running along a road artery in the outskirts of Salon-de-Provence, which is considered as a secondary city. The site is functional and effective in respect of the budget hotel target markets.

ANF funded a 113-room hotel situated at Aulnay-sous-Bois (93) outside of the partnership which it bought for €5 million excluding transfer taxes.

Situated 15 kilometres north of Paris, Aulnay-sous-Bois is the third largest city in Seine-Saint-Denis. With 1,620 hectares, the city comprises 44% detached family homes and 30% industrial areas. There are 3,500 businesses located there including PSA Peugeot Citroën and L’Oréal.

The hotel is situated close to the Parinor II regional shopping centre (with 80 shops including Carrefour), in a mixed-use zone comprising offi ces, warehouses, hotels and restaurants, detached family homes and open spaces.

The partnership entered into with B&B also stipulates that ANF will pay for work to improve the hotels acquired in October 2007. This way, ANF contributes to maintaining the intrinsic value of its assets while collecting additional rental income. Indeed, every euro invested in renovation work generates additional rental income computed on the basis of 5.80% of the amount paid. ANF’s total contractual commitment is €30.5 million excluding indexation.

In the course of 2008, €11.6 million excluding VAT was invested representing nearly €700,000 of additional rental income excluding tax and indexation, on an annual basis.

Financing for the partnership with B&B is provided by a line of credit contracted in October 2007 at a cost of Euribor + 50 bp. All of the contractual obligations, both construction work and hotel acquisitions, are covered by a line of credit which was specially tailored for the job. Furthermore, all of the debt drawn down is covered at a 4.94% fi xed rate.

In 2009, the partnership will continue with the acquisition of fi ve new hotels (Valenciennes, Lille, Mulhouse, Paris-Pleyel, Arras) now under construction for a total of €24.6 million. ANF expects to also pay €10 million of the construction costs.