INE: Foreigners Account For 82% Of Overnight Stays In 5-Star Hotels

29 August 2017 – El Economista

Foreigners who visited Spain in July registered more than 1.9 million overnight stays in five-star hotels, representing 82% of the total number of nights sold in the most luxurious category of hotel accommodation.

According to data extracted by Servimedia from the Tourist Hotel Environment Survey from the National Institute of Statistics (INE), five-star hotels recorded the highest percentage of clients from overseas, exceeding the average for hotel accommodation as a whole, where foreign clients accounted for 67.2% of all rooms, by 15 percentage points.

In fact, 6.5% of the overnight stays by foreigners in Spanish hotels were registered in five-star hotels, a percentage that more than doubles the 2.8% recorded by domestic clients in high-end establishments.

Meanwhile, four-star hotels registered more activity in Spain by both overseas and domestic tourists. The presence of foreign clients amounted to 69.3%, with 14.6 million overnight stays, compared to 6.4 million overnight stays by domestic visitors.

This figure of overnight stays in four-star hotels accounted for 49.7% of all stays registered by overseas tourists in the country, compared to a percentage of 45.2% in the case of domestic tourists.

If we add together the overnight stays registered in the two highest categories, we see that 56.3% of the foreigners that visited Spain in July slept in four and five-star hotels, whilst in the case of Spaniards, that percentage amounted to 48.1%.

After four star hotels, the accommodation most used by foreigners and by local tourists alike were three-star hotels, which hosted 33.2% of overseas tourists and 28.8% of domestic visitors.

Specifically, international tourists registered 9.7 million overnight stays in three-star hotels in July, accounting for 70.2% of the total in that category, compared to 4.1 million domestic overnight stays.

In the remaining categories, 1.4 million overnight stays or 4.7% of the total number of stays by foreigners were in two-star hotels; 0.4 million or 1.5% were in 1-star hotels; 0.5 million or 1.9% were in three- and two-star hostels; and 0.6 million or 2.1% in one-star hostels.

Of these four categories, domestic clients accounted for a higher percentage of total stays than foreigners in the lowest three, whilst overseas tourists accounted for 52.2% of overnight stays in two-star hotels. Specifically, domestic clients accounted for 54.3% of stays in one-star hotels, 58% in three- and two-star hostels and 50.7% in one-star hostels.

Original story: El Economista

Translation: Carmel Drake

Nine Projects Planned in Barcelona Will Increase Tourist Capacity

 

24 August 2017

Developers planning four hotels, three guesthouses, a hostel and a block of apartments have requested permits in peripheral areas, the only areas allowed by the Colau plan.

While still waiting to discover what impact the terrorist attack of the 17th will have on the tourism sector, Barcelona had attracted new hotel investments. The nine projects will provide 900 beds and the developments are planned in peripheral neighbourhoods, the only areas in which the tourist accommodation plan that came into effect at the beginning of 2017 permits new accommodations.

Since then, the City Council has received nine license applications for projects in these areas, which are necessarily less attractive, being far removed from the principal tourist areas. The municipality has concluded that the projects all comply with the new municipal regulations put in place by the current mayor, Ada Colau.

The projects include four hotels, three guesthouses, a block of tourist apartments and a hostel, as the deputy mayor of urbanism, Janet Sanz, told Expansión.

The exact location of the hotels has not yet been determined. The only specific details that the municipal government provided were that the projects will be in Sants-Montjuïc, Horta-Guinardó, Sant Andreu, Sarrià-Sant Gervasi and Nou Barris, which will receive a guesthouse.

The Barcelona City Council has not provided any further details to date, although industry sources have given additional information on some of these projects.

The hotel with the greatest number of rooms, 200, will have four stars and will be in the neighbourhood of La Marina, in the district of Sants-Montjuïc, next to the fairground of Gran Via, at 40 Calle Alts Forns.

Another hotel, which will have one star and 70 rooms, will be located at 250 Meridiana, in the Sant Andreu district, near the La Sagrera interchange.

The new tourist accommodation regulations came after a moratorium that was imposed by Ada Colau in July 2015, just after being elected mayor. The measure prevented further licensing of hotels throughout the city, something that will now only be allowed in peripheral neighbourhoods. However, there were 72 projects that managed to circumvent the new regulations, because they had already previously acquired a license or certificate. Of these 72 hotels, about thirty have been opened and are managed by chains such as H10, Núñez i Navarro, Princess and Accor.

The new regulation divides Barcelona into four zones. In the first, which covers the most central and tourist areas, a policy of “de-growth” has been established: not only will new licenses not be granted, but, if one establishment closes, it cannot be replaced by another.

Zone 2, a first belt around the centre, is subject to a policy of “maintenance”: that is, no new accommodations will be created, but if an establishment closes, another would be allowed to take its place.

The growth of hotel spaces, in a “contained” way, will only be permitted in Zone 3. Projects must also meet other requirements, such as being located on wide streets and not exceeding a certain density threshold. The municipality will ascertain whether each project complies with regulations and if this is the case, it guarantees that the processing of the application will go forward. In Zone 3, regulations that are specific to the historical centres of the old municipalities that were eventually incorporated into Barcelona must also be considered.

Finally, Zone 4 includes three developing neighbourhoods that will also have their own urban regulations. They are La Marina, the future AVE station in La Sagrera and its surroundings, and the Poblenou neighbourhood, where the 22@ district was launched 15 years ago.

The effects of the plan

The tourism sector has assessed the Colau plan from different points of view. Initially, it opposed the plan, although the Barcelona Hotel Association has since softened its position because one of the effects of the regulations is that existing hotels will have much less competition.

Juan Gallardo, of Bric Consulting, predicts that, if the city maintains its attractiveness as a tourist destination, the plan could imply “a price increase”, which would be added to the price increases that occurred because of the moratorium.

The new regulation has been the subject of a total of 17 contentious-administrative appeals in the courts, although only one of them is demanding compensation from the municipality. If rulings are declared that are contrary to the Colau plan, the city council could be forced to rectify the plan and elaborate new regulations. The Barcelona Hotel Association is the author of one of the appeals because it believes that the regulatory reforms would force hotels in the centre of Barcelona that undertake renovations to reduce the number of rooms, which would condemn them to decline and eventual “decadence”, Gallardo pointed out.

Original Story: ProOrbyt Expansion – David Casals

Translation: Richard Turner

Hotels Increase Revenues and Prices Spurred by Record Occupancy

24 August 2017

Spain registered a historic high of 44 million overnight hotel stays and a record occupancy of 73% in July. The data show increases in hotel rates of 7% and average daily revenues per room of 8%.

The recent successive tourism records are translating into historic highs in overnight stays and occupancy, and underline the hotel sector’s ebullience. In July 43.6 million overnight stays were registered in hotels, 1.6% more than in July 2016. Overnight stays between January and July increased by 3.8% and exceeded 190.6 million overnight stays, according to the latest report by Hotel Statistics, prepared by the National Institute of Statistics (INE).

11.8 million Spanish and foreign travellers stayed in hotels in July. The record figure lends credence to previous forecasts that 2017 will be a new record setting year, with more than 83 million arrivals. At the same time, hotel occupancy rates stood at 73.1% (an increase of 0.7%). In the case of weekends, occupancy rates rose to 77.3%, an increase of 2.2%.

Areas that are traditionally the focus of tourism are at the centre of data on hotel occupancy. The Balearic Islands reached a rate of 90.7% in July, accounting for 34% of total overnight stays in Spain, followed by the Canary Islands (83.6%) and Catalonia (77.7%). Barcelona continues as the most favoured city with an 83.9% occupancy rate. Looking at total overnight stays, the most crowded area has been Mallorca, with 8 million overnight stays and an occupancy rate of 92%. As for average stays, Pájara, a municipality located in Fuerteventura, registered an average stay of 8.42 days.

These figures are great news for the hotel sector, which continues to increase revenues and raise prices per room. Thus, the Hotel Price Index (IPH) increased by 6.9% in July. The Balearic Islands, Catalonia, the Canary Islands and Andalusia accounted for 76.9% of the HPI.

The rate hotels charge on average for each room stood at 98.5 euros. This is an increase of 6.1% compared to July 2016. Likewise, the average daily income per available room (RevPAR) rose 7.9% in July, to 74.8 euros. In the Balearic Islands, the same figure amounted to 105.8 euros (4% more), while in Catalonia it soared 16%, to 86.8 euros.

The Circle Widens

Although the countries in the European Union continue to lead overnight stays, accounting for 80.3% of the total number of foreign visitors, tourism from countries further afield is growing at a faster pace. In fact, while visitors from countries like France, the United Kingdom and Belgium fell by 7%, 5% and 4%, respectively; overnight stays of tourists from Russia and Japan soared by 24% and 20%. In the case of the United States, the increase was 16% in July. Germany would be the exception that confirms the rule. The increase of overnight stays of German tourists amounted to 9%.

Although the number of overnight stays continues to increase, the sector faces several challenges that will permit hotel revenues and prices to continue to increase. The first involves the democratization of transport, where people will be able to travel more for less money, but over shorter periods of time.

Specifically, the Spanish government, through the Secretary of State for Tourism, announced a strategic plan focusing on quality tourism, whose economic impact is coupled with the record arrivals. So far, Spain ranks second in the world in terms of revenues from tourism, with €54 billion, according to the latest ranking of the World Tourism Organization, only behind the United States, which is favoured by visitors from more countries around the world, who have more purchasing power and stay for longer periods.

The second challenge is related to the disruptive entry of new players into the field of tourist accommodations. Vacation rental platforms have revolutionized the sector, to the point where the places they offer are more than double the number of hotel rooms in the main cities. The impact of the boom of these platforms has placed constraints on occupancy rates, prices and revenues in the formal hotel sector, which is subject to greater regulatory oversight.

Original Story: ProOrbyt Expansion – Inma Benedito

Translation: Richard Turner

 

Port Hotels Buys Two Hotels in Alicante

23 August 2017

Port Hotels has closed the purchase of the Holiday Inn Alicante-Playa de San Juan and the Holiday Inn Elche from the Jualba group, which suspended payments a year ago. Port Hotels will maintain staff and undertake reforms to reorient its services.

Original Story: Expansión – Rebeca Arroyo

Translation: Richard Turner

Hotel Chains Invest €2.5 Billion to Reposition Their Portfolios

23 August 2017

Meliá, Barceló, RIU, NH, Palladium and Iberostar redouble their investments to reach new markets, reinforce the presence of their premium brands and raise prices.

The hotel chains are taking advantage of the boom in tourism and profits from recent years to invest in upgrading their assets. The Spanish groups have launched investments of about 2.5 billion euros in recent years and are planning to increase them further to reposition their asset portfolios, boosting their premium segment to attract clients willing to spend more on better accommodations.

With these measures, the hotel groups are seeking to boost profitability and enhance operational efficiency by focusing more on prices than on occupancy, where they have little room for growth. In addition, companies are looking to enter new markets, diversifying risks should the current cycle change.

One of the most active in the repositioning of its assets has been Meliá Hotels. The company allocated 260 million euros last year to the maintenance and refurbishment of its establishments around the world. The firm has emphasized the improvement of its hotel portfolio in Spain. Specifically, in the last five years, it has invested €500 million with its partners to upgrade its Spanish hotels, of which more than €200 million have gone to Magaluf (Mallorca).

For its part, RIU invested $500 million dollars last year in the purchase, construction and renovation of hotels and plans to allocate more than $400 million in 2017 for the complete renovation of six hotels and further openings. In recent years, the chain has renovated 13 hotels with a cumulative investment of $200 million projects in Spain alone.

Openings

With regards to new openings, the RIU hotel group plans to open its first hotel in Madrid in 2019. The company chose the Edificio España for its arrival in the Spanish capital, where it will invest between €380 million and €400 million, including the price paid to Baraka for the purchase of the asset last June.

Iberostar is another of the hotel groups that has launched an investment program to open new hotels and update some of the establishments in its portfolio. In 2016, it opened hotels in new areas such as the United States and Ibiza. In addition, as part of its policy of reinvesting profits, in 2016 it dedicated more than €90 million to the hotel renovations and plans to allocate more than 300 million euros in partial and total renovations by 2018.

For its part, Palladium has opted to grow in the Caribbean and reposition its presence in the Spanish islands. The hotel group belong to the Matutes family last year allocated 80 million euros to Hard Rock Tenerife and will invest 450 million euros up to 2018 to reposition two hotels in Ibiza, remodel and expand its hotels in Rivera Maya and the open two establishments in Costa Mujeres and another in Cancun, all in Mexico.

Within the framework of its strategic plan, NH invested 200 million euros in the renewal of assets between 2014 and 2016. Investments in Spain accounted for 42% of this figure. As a result of the strategic plan, at the beginning of 2017, one of every five of the group’s rooms belongs to the chain’s premium brands NH Collection and nhow.

Similarly, Barceló has launched a new set of brands and destined an average of 100 million euros per year to reposition its product portfolio.

The Piñero Group’s strategic plan is to upgrade their existing hotels and pursue a consolidation in its main markets through the opening of new establishments. To this end, the chain has invested €50 million in the construction of a new five-star luxury hotel in the municipality of San Miguel de Abona.

Original Story: Expansión – Rebeca Arroyo

Translation: Richard Turner

Oceanwood Boosts Its Participation in NH Hotels, Reaching 14.3%

 

18 August 2017

The British fund Oceanwood has raised its stake in the NH Hotel Group to 14.3% from 14.1%. Oceanwood has 50.11 million shares of Spanish hotel chain and has consolidated its position as its second largest shareholder, behind the Chinese group HNA, which controls 29.5% of the capital, and ahead of Hesperia, which has 9%. According to information sent to the Spanish National Securities Market Commission (CNMV), of the declared voting rights, 10,012 million (2.86%) correspond to borrowed shares, Europa Press reported.

Original Story: Expansion ProOrbyt

Translation: Richard Turner

Spanish REITs Assets Soar in Value to €24.2 Billion

 

15 August 2017

UP 40% IN THE YEAR

Merlin, Colonial, Hispania, Axiare and Lar Espanã increased their stock market values by almost 25% and have put real estate worth more than 1.7 billion euros on the market since the end of 2016.

The socimi’s rise this year has been meteoric and their prominence in the Spanish real estate market is indisputable.  In just one year, Merlin, Colonial, Hispania, Axiare and Lar España have increased their total gross asset value by almost 40% to €24.2 billion. This compares to a 25% increase in the Spanish stock market in general.

Colonial, which in June converted itself to a socimi structure with retroactive effect to January, conferring special tax status, has increased the gross value of its assets in the last twelve months by almost 15%, to 8.66 billion euros. This has led the company to increase its profits by 90%, to 437 million euros. The share price of the group chaired by Juan José Bruguera, which has appreciated by 36% since the end of 2016, is at all-time highs, with a total market capitalization of 3.174 billion euros.

According to the latest available data, Merlin, which will submit its semi-annual accounts on September 22, ended March with a gross asset value of 10.026 billion euros, up 62%. So far this year, the company has increased its stock market value by 12% to 5.430 billion euros, making it the largest listed real estate company in Spain.

One of the most active socimis this year in terms of acquisitions has been Axiare. The group, led by Luis López de Herrera-Oria, ended the first half of the year with a portfolio valued at €1.709 billion, up 63%. Just in the first half of the year, Axiare acquired six office and logistics assets in Madrid and Barcelona for a total of €215 million. The company has a market capitalization of €1.294 billion, 30% more than the €993 million it was valued at in December 2016.

Hispania added almost €2.340 billion in assets in the year to June, up 44% compared to the same period in 2016. The company owned by George Soros increased its net profit by 35% to €185 million, and its value on the IBEX stock exchange is close to 1.700 billion euros, compared to €1.213 billion at the close of last year.

For its part, Lar España finished the semester with 31 assets in its portfolio whose value reached 1.448 billion euros, up 38%. The company, which counts Pimco as an investor, had its profits go up by 50% in the first half of the year, to 65 million euros, and its market capitalization already exceeds 750 million euros, 22% more than at the end of 2016.

After the intense investment activity of the last three years, the Spanish REITs have entered a new phase in their strategy, accelerating turnover in their assets to lock in gains on their original investments, at a time when investors are eager for opportunities and the market is in full swing. With the asset sales, the socimis are looking to bring in new capital to make new purchases.

In addition, these investment vehicles can now take advantage of the fact that some of their assets have already met the minimum requirement to hold onto investments for three years before they can be sold to generate capital gains.

The socimis have sold or are planning to sell assets in the coming months for a combined value of more than 1.7 billion. Just a few weeks ago, Colonial sold the OECD’s headquarters in Paris. SLF, a French branch of the real estate company, reached an agreement for the sale of the property known as In&Out. Although the group did not disclose the amount of the transaction, market sources put it at around 450 million euros, a premium of more than 25% over its last sale price. The transaction is expected to be officially registered during the second half of the year. Colonial “continuously” revises the value creation potential of each property with a view to future disinvestments.

Merlin has been one of the most active Spanish REITs in terms of asset turnovers. After selling off its residential investments after its merger with Metrovacesa, and selling office buildings and branches in France last year for an aggregate amount of 226 million euros, the company agreed, at the end of 2016, to sell 19 hotels to the French real estate company Foncière des Regions for €535 million.

New opportunities

Hispania, the socimi managed by the Azora Group, reached an agreement in June to sell its Aurelio Menéndez office building for €37.5 million, an increase of 39% in its valuation since December 2016. In parallel, it has continued with its plan to sell off its residential portfolio, selling 25 assets in the Isla del Cielo and Sanchinarro buildings. Hispania also finalized the sale of its office assets to Swiss Life, including 25 assets in Barcelona, Madrid and Málaga, for 510 million euros, as reported by Expansión on August 8.

Hispania, which plans to liquidate itself by March 2020, six years after listing, will focus on its hotel portfolio, in which it continues to invest to reposition assets. Shareholders voted to extend the investment period until December 31 for this reason.

Lar España will also begin to rotate assets in the coming months to obtain new funds with which to undertake acquisitions in retail, its main business, and logistics. It expects to deliver a luxury real estate development in Madrid, on 99 Lagasca street, which it owns together with its largest shareholder, Pimco. The delivery of this development should generate sales of about 210 million euros, half of which will go to Pimco.

The luxury development’s units are being sold at an average price of 11,000 euros per square meter and the asset has a surface area of 21,000 square meters. At the end of June, pre-sales had reached 65%. Company sources indicated that Lar España will continue to focus on asset turnovers to generate value and focus on offices, where it believes that there are more opportunities.

Axiare stated that it will analyse new opportunities at the end of 2017, when some of its assets will start to reach the three-year mark on its portfolio. “Turnover will be selective, just as our purchases were. Assets will be analysed on a case by case basis and any decisions will be based on market opportunities,” it added.

Original Story: ProOrbyt Expansion – Rebeca Arroyo

Translation: Richard Turner

The Balearic Islands Sets a Limit of 623,624 Places for the Tourism Sector

 

9 August 2017

The Balearic Islands’ government’s new law will enter into force to “put some order” into residential tourist rentals, with fines of up to 400,000 euros for platforms like Airbnb.

The Government of the Balearic Islands announced yesterday the enactment of a new law that limits tourism to a maximum ceiling of 623,624 places among all the islands, including hotel and non-hotel spaces. This “ceiling” comes into force amid controversy over the management of tourism and tourism-phobia, in the face of the latest incidents by radical groups. Of the limited spaces, 435,707 correspond to Mallorca, 109,800 to Ibiza, 60,117 to Menorca and 18,000 to Formentera.

The pioneering law includes fines of up to 400,000 euros to tourist accommodation rental platforms. The objective is to “put order” in the activity and gradually reduce the number of places available.

The Government of Francina Armengol (PSIB-PSOE) modified the PP’s previous law, permitting the councils of each island (Mallorca, Menorca, Ibiza and Formentera) and the Palma city council to determine whether they will allow tourist rentals in homes, for how long and in what areas. The institutions will have a year to decide on their course of action, though they are expected to stick to the ban.

The rental of apartments to tourists was already prohibited in a law promulgated by the PP party’s government in the previous legislature. Nevertheless, the modality had been allowed through the Law of Urban Leases. According to Tourism Minister and Balearic Vice-President Biel Barceló, the law aims to end “speculation” in housing rentals and to foster “responsible, sustainable and balanced” tourism. However, it will also affect the hotel sector, limiting the number of places.

The rental housing platforms will have 15 days to adapt to the new law, according to a statement that the Balearic Government sent to 30 of these companies. Otherwise, fines will range from 20,000 euros, in the case of owners who rent apartments to tourists, to 400,000 euros, for real estate, tourist intermediaries or digital platforms such as Airbnb or HomeAway.

Of the ceiling of 623,624 places, there are 120,000 that have been granted since 1999 under an exceptional regime which will not be renewed as they expire, to slowly reduce the total supply.

To prosecute illegal home rentals, the Ministry of Tourism will create an electronic platform for citizens to report the owners who rent them. The complaints will not be anonymous and will only serve as an indication of where inspectors should look.

For practical purposes, starting yesterday, home owners who house tourists in their home for less than 30 days, without a rental contact and without the visitor having paid a bond, is acting illegally and could be fined.

Airbnb said in a statement that the new law is “complex and confusing” and called for joint action “to help create sustainable tourism model that share the benefits among many, rather than leaving them in the hands of a few.”

The need for a new management model in the face of the strong increase in tourists – 30 million since 2010 – and the latest incidents against tourism by radical groups such as Arran in Palma de Mallorca have put pressure on the autonomous governments. Barcelona was the first city to announce measures, since tourism has exceeded the city’s capacity, where some neighbourhoods have had a transitory population of tourists greater than the population of regular inhabitants. Last week the San Sebastián City Council also announced a plan for the sustainable management of tourism.

The director general of Tourism of the Balearic Islands, Pilar Carbonell, reported that in spring a campaign was launched in Mallorca to clamp down on the advertising of rental homes to tourists through realtors.

Original Story: Expansión ProOrbyt

Translation: Richard Turner

Dospuntos Sells Hotel in Malaga to European Fund for €27 Million

 

8 August 2017

The Vincci Selección Posada del Patio Hotel in Malaga has been acquired by the European real estate investment fund Internos Global Investors.

Dospuntos is unloading of one of its assets. The Vincci Selección Posada del Patio Hotel in Malaga has been acquired by the European real estate investment fund Internos Global Investors for 26.75 million euros. Dospuntos, controlled by the US fund Värde Partners, was advised in the deal by the real estate consulting firm JLL.

The hotel, one of only two five-star hotels that exists in the city of Malaga, has 106 rooms and a total area of approximately 11,300 square meters spread over seven floors. Vincci Hoteles has operated the hotel since its construction in 2010 through a long-term lease.

Dospuntos was created from the former real estate development company Grupo San José (which in turn originated from the ex-Parquesol). The developer started operations with land sufficient to build 7,000 homes, to which purchases worth 2 billion euros will be added by 2025.

Original Story: EjePrime

Translation: Richard Turner

Cordish, the Last of the Big Failed Real Estate Projects

07 August 2017

Eurovegas, Operation Campamento, the Four Seasons of Barcelona and the Hyatt hotel project in the Torre Agbar are some of the most famous unsuccessful investments in Spain.

They were destined to occupy prominent positions in the ranking of mega real estate projects but were doomed to failure, even before starting out. Failure to comply with regulatory requirements, bureaucratic obstacles and clashes with the relevant authorities have been some of the factors that have caused the failure of multi-million-dollar investments planned by, among others, the North American group Cordish, the Chinese giant Wanda, the American magnate Sheldon Adelson and projects by the multinationals Four Seasons and Grand Hyatt in Barcelona.

The last project to flounder has been Cordish’s. The Baltimore-based group wanted to build a leisure and gambling complex in the Madrid municipality of Torres de la Alameda. But the Madrid Autonomous Community has rejected the proposal under the Integrated Development Center (CID) not once, but twice, considering that the project will not impact the economy, employments levels and culture sufficiently, while also questioning the project’s feasibility.

Cordish’s truncated plan joins Eurovegas, the ill-fated gambling complex that American Sheldon Adelson intended to build in Alcorcón, the Gran Scala fiasco in the Los Monegros desert and the mirage of The Kingdom of Don Quixote in Ciudad Real.

Another of investor that has accumulated bad experiences in Madrid is the Chinese giant Wanda, which owns 20% of Atletico Madrid. The conglomerate, led by the tycoon Wang Jianlin, announced three years ago its intention to invest at least 3 billion euros in a high-end complex with up to 15,000 luxury dwellings in the former Campamento barracks in Madrid owned by the Ministry of Defence. In addition, the urbanization plan included a commercial complex, theme parks and casinos. The Chinese group, however, gave up its plans when faced with land prices it considered exorbitant. Months later, another of Wanda’s star projects in Madrid went up in smoke. The group, which had bought the Edificio España from Santander for 265 million in 2014, decided to put it on sale after disagreements with the Madrid City Council, which required the conservation of the front and side facades, as established by the law on protection of historic buildings.

Vetoes

Hotel investments have suffered a setback in Barcelona as well. Suspended licenses have caused large international chains to withdraw from their projects in the City of Barcelona.

In particular, the arrival of the hotel brand Four Seasons in Barcelona was truncated by a municipal veto. KKH Property Investors paid 90 million euros for the Deutsche Bank building, located at the intersection of Barcelona’s Avenida Diagonal and the Paseo de Gracia. KKH was seeking the demolition of the building, to subsequently build a larger building, to be run by Four Seasons. But the project collided with the then activist Ada Colau, who turned the rejection of the project into one of her electoral promises. Her election to the Barcelona City Council in the summer of 2015 cut short KKH’s plans, which has chosen instead to rehabilitate the old office building and convert it into high-end residential housing. Four Seasons, which will land in Madrid in early 2019 at the Canalejas complex, is still looking for locations in the city.

Another of the big international hotel chains that could have come to Barcelona was Hyatt. In 2013, fund manager Emin Capital, led by Andorran Jordi Badia, announced that it had bought the Agbar Tower for 150 million euros and was preparing to convert it into a luxury hotel that would be managed by the US hotel chain. Three years later, the project had still not been approved and the asset was finally sold to Merlin Properties, which will maintain it as an office building and hope that it will become the headquarters of the European Medicines Agency (EMA).

Original Story: ProOrbyt Expansion – Rebeca Arroyo/Marisa Anglés

Translation: Richard Turner