96
96

Sidorme Puts 7 Hotels Up For Sale For €25M

28 December 2015 – El Economista

The hotel chain Sidorme is negotiating the sale of a portfolio of seven assets with an asking price of around €25 million. According to Jairo González, the CEO of Sidorme, the objective is to sell the hotels in a single transaction; and interested parties include large investment funds and Socimis. For the time being, “we have not reached any agreements in terms of price, but we are negotiating the returns”, says González.

Through this operation, the group, which is currently in the middle of a growth phase, may deleverage its balance sheet in order to target new investments, but it acknowledges that it is not in any rush, given that it is currently obtaining yields “that it feels very comfortable with”.

Besides these seven hotels that it owns, the chain also has another three hotels that it leases, which together contain 1,230 rooms. It is also constructing another three hotels.

The company’s hotel location strategy is proving key to its success, with the tenth hotel recently opened to the public on Calle Fuencarral 52 (Madrid) and the eleventh hotel currently under construction on the central street of Calle Montera 10-12 (also Madrid).

A twelfth hotel is also under construction and is located between the airport of Donostia San Sebastián and the Guipúzcoan capital; and a thirteenth hotel will open in January in San Sebastián de los Reyes (Madrid), close to La Moreleja and Terminal 4 at Madrid’s Barajas Airport.

The company is going to spend €10 million on the opening of its new hotels, in addition to the €45 million that it has already spent to create its existing portfolio since it began operations back in 2006, with the opening of its first hotel in Mollet del Vallès. With these investments, the chain expects to record turnover of more than €10 million in 2015, with an EBITDA of more than €2.7 million and a net profit after tax of more than €1.3 million, according to González.

The success of this chain is due to its commitment to intelligent accommodation. Its “smartsleep” concept seeks to maximise the simplification of the product offered, eliminating anything that is superfluous for guests and optimising all of the services to reduce operating costs as much as possible, without affecting the quality of its customers.

Thus, its hotels offer modern rooms with simple designs, large beds, showers with a sauna effect and free wifi. They are have offices with fruit and coffee available for clients, but they do not have internal cafeterias or restaurants, although they have reached agreements with nearby restaurants to offer room service at some of their hotels. These savings comes in addition to the fact that the hotels are constructed to require very little maintenance and to consume minimal energy.

Original story: El Economista (by Alba Brualla)

Translation: Carmel Drake