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Amancio Ortega Lets His Barcelona Gem to Iberostar

24/10/2014 – Expansion

Iberostar increases its bet on the urban segment and allies with Amancio Ortega, the owner of Inditex, to settle in Barcelona. From 2016, the chain controlled by the Fluxa family is going to manage, while renting, a 4-star hotel located on the upper floors of the building belonging to Ortega’s Pontegadea and found at 1 Paseo de Gracia street, Barcelona.

In 2012, the holder of Zara bought the ground floor shop of the property, now let to Apple, for €86 million. In January this year, the businessman purchased the rest of the building, formely serving Banesto as its Catalonian headquarters, from Sareb.

According to sources with knowledge on the matter, initially Amancio Ortega planned development of a hotel on the upper stories but due to high cost, he opted for remodelling the now-empty property and handing it over to Iberostar.

Sabina Fluxa, vice-president of Iberostar, confirmed the intention of the firm to open a new establishment in Barcelona.

The four-star hotel would start operating in mid-2016.

Cooperation between Amancio Ortega and Iberostar is no novelty. In 2012, the partners paid €95 million for a five-Spanish-hotel portfolio to Thomas Cook. Although holiday accommodation is the main business of the hotel chain, it decided to bring some diversification to its asset pool.

Thus, Iberostar added several urban establishments in Santa Cruz de Tenerife (the Grand Hotel Mencey, 5*) and Hungary (the Grand Hotel Budapest), as well as in Madrid, London, Berlin and Rome.

At the end of 2013, Iberostar, the fifth biggest Spanish chain, owned over one hundred hotels in 13 countries. It earned €1.1 billion improving the previous year volume by 6%. The firm wants to double the number of its assets within 10 years and reach between 200 and 250 hotels.

 

Original article: Expansión (by Yovanna Blanco)

Translation: AURA REE