hospitality Market News: Spanish Real Estate Intelligence

Meliá Sells 3 Hotels to Socimi Atom for €73.4M

13 July 2018 - Expansión

Meliá Hotels has announced an agreement with the Socimi Atom Hoteles, in which Bankinter holds a stake, for the sale of three hotels in Sevilla, Santa Cruz de Tenerife and Fuerteventura for €73.4 million.

The transaction, which will generate a net accounting profit of €6.6 million, includes the hotels Meliá Sevilla, Sol La Palma (Santa Cruz de Tenerife) and Sol Jandía Mar (Fuerteventura), respectively.

The establishments will continue to be operated by Meliá by means of variable rental contracts (25% of the total revenues) for periods of 5 years, with a maximum of 4 extensions at the discretion of Meliá and up to a maximum of 25 years.

The operation values each room at €66,000 and represents an EBITDA (result before depreciation and amortisation) multiple of 13.9 times.

As part of the agreement, Atom undertakes to invest €20.2 million in the three hotels, whereby allowing their “repositioning”. Thus, the price per room after the investment will amount to €83,000.

The hotel chain has said that this sale forms part of its “strategy to adapt the attributes of the brands of all of the establishments operated by the company”.

Original story: Expansión (by D. B.)

Translation: Carmel Drake

Costa Bellver Starts Work on its 1,000-Home Macro-Project in Oropesa

10 July 2018 - Eje Prime

The starting gun has been fired on the Calabuig family’s project in Oropesa del Mar (Castellón). The Valencian businessman Eugenio Calabuig (pictured below) has requested the first building permit for the construction of the first 56 homes in the macro-project comprising 1,000 homes in total and one hotel that his company, Costa Bellver, is planning to build in the seaside town.

The first occupancy licence is being processed, as it awaits the green light from the Town Hall. In Torre Bellver, close to Les Platgetes de Bellver, the Calabuig family are looking to increase the prime residential market, according to València Plaza.

Not in vain, Costa Bellver is keen to attract a new kind of buyer with a high purchasing power. In addition to the 1,000 homes, the company is going to build a luxury hotel to accommodate the large number of tourists who visit the area during the holiday period.

Original story: Eje Prime 

Translation: Carmel Drake

CBRE: Hotel Investment Plummets by 55% in H1 2018 to €960M

6 July 2018 - Eje Prime

Investment in the hotel sector is dropping down a gear in Spain. Despite the significant growth in tourist rates, investment in the Spanish hotel sector fell by 55% during the first half of 2018 with respect to the same period last year, down to €960 million.

Assets for vacation use accounted for 78% of the total amount disbursed in the sector, which continues to be one of the most sought-after in the world, according to a report from CBRE.

Data from the consultancy firm also highlight that institutional investors are responsible for the majority of the market, accounting for 43% of the spending in Spain between January and June, followed very closely by the hotel groups themselves, with 40% of the market. Family offices only accounted for 12% of operations.

With respect to the first half of 2017, the main changes that CBRE has noted in its report about hotels is the decrease, of up to 90%, in terms of investment undertaken in Barcelona and Madrid. This fact has resulted from a significant decrease in capital investment in urban assets, which decreased from 54% last year to 22% during the first half of this year.

Moreover, three-quarters of the transactions that were undertaken during the first half of 2018 corresponded to the sale and purchase of individual assets, compared with 25% of operations that involved portfolios.

The main investments signed in the Spanish hotel market were Portfolio Alua, for an approximate sum of €165 million; the Ritz Carlton Abama and the Costa del Sol Princess, whose amount was not disclosed; and the €63 million that was disbursed for IFA Interclub Atlantic.

“Interest in the Spanish hotel market has not diminished but it is true that the increase in asset prices and the shortage of opportunities is shifting the focus of investors to secondary destinations, which, also, have performed extremely well in recent months”, explains Jorge Ruiz, National Director of Hotels at CBRE in Spain.

Original story: Eje Prime

Translation: Carmel Drake