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Benson Elliot Buys Hotel Silken In Barcelona For €80M

7 October 2016 – Expansión

A major operation and better gains for Bank of America Merril Lynch in Barcelona. The US entity is finalising the sale of Hotel Silken Diagonal for €80 million to a group of investors led by the British fund Benson Elliot. Bank of America will generate capital gains of €50 million from the property in just one year, given that it took over the hotel in 2015 when it foreclosed the debt relating to the property, amounting to €27 million.

According to sources close to the operation, the sale has not been signed yet, although the vendor has entered into an exclusivity period with the purchaser group.

Bank of America Merril Lynch ended up with the mortgage loan following the crisis of the Urvasco group, the parent company of the Silken hotel chain, after it filed for bankruptcy.

The property has 240 rooms and a four-star rating. It is located in the 22@ district of Barcelona, next to the Torre Agbar, and it has a management contract with Silken. The operation has been advised by JLL, which declined to comment on the operation yesterday.

The amount (€80 million) that Benson Elliot has paid together with another investor group, whose name has not been revealed, has been described as exorbitant by several sources in the real estate sector, who point out that the building is located away from the city centre in Barcelona, in an area that suffered a lot at the beginning of the crisis.

Nevertheless, the same sources also indicate that the hotel moratorium applied in Barcelona last year by the mayoress Ada Colau, together with the strong investor appetite for assets in the Catalan capital and the shortage of buildings on the market, have driven up the price of the few properties that have come onto the market. Bank of America put this asset on the market a few months ago and several international investors submitted bids for it.

Original story: Expansión (by Marisa Anglés)

Translation: Carmel Drake

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