Blackstone Negotiates Purchase of Grupo Alua’s Hotels

18 December 2017 – Expansión

The US investment fund Blackstone wants to strengthen its position in the hotel segment in Spain. After acquiring Sabadell’s hotel portfolio in October for €630 million, Blackstone is now analysing the acquisition of the hotel portfolio owned by Alua Hotels & Resorts to strengthen its presence in the market.

Sources in the sector explain to Expansión that the US fund has been negotiating with the owners of Alua for several months regarding the operation and, although it is not the only player bidding for its portfolio, it is one of the best positioned to close the deal. The portfolio owned by Alua Hotels & Resorts currently includes seven hotels with more than 1,700 rooms located in different parts of the Balearic and Canary Islands.

Specifically, Alua owns four establishments in Palma de Mallorca: the AlauSoul Palma, with 120 rooms; the AluaSoul Mallorca Resort, with 371 rooms; the AluaSoul Alcudia Bay, with 171 rooms; and the AluaSun Torrenova, with 256 rooms.

Management agreement

In addition, it owns the AluaSoul (in Ibiza), with 290 rooms; the Hotel Parque San Antonio (in Tenerife), with 252 rooms; and the Hotel Ambar Beach, (in Fuerteventura) with 244 rooms.

Alua Hotels & Resorts –previously known as Feel Hotels Group– was created in 2015, inspired by the European private equity firm Alchemy Special Opportunities and by Javier Águila, former Director of Orizonia, following the purchase of six hotels, with more than 1,200 rooms, in Mallorca and Ibiza. The portfolio used to be owned by Marina Hotels (…).

Moreover, Alua Hotels & Resorts manages five Intertur Hotels acquired in May 2017 by KKR and Dunas Capital. Those establishments, which comprise 1,120 rooms in Mallorca and Ibiza, were worth just over €120 million.

The agreement reached between KKR, Dunas Capital and Alua Hotels & Resorts considered the repositioning and modernisation of the five establishments and the management of the hotels by Alua following the entry into force of the agreement and their marketing under its brand in 2018.

Alua Hotels & Resorts, which last year recorded turnover of €28 million, has more than 1,200 employees.

Record investment

The tourism boom in Spain, the appetite for real estate and the liquidity in the market are continuing to encourage hotel investment, which may reach €3 billion by the end of the year; that would represent a new record for this segment (…).

Moreover, if these negotiations prove successful, the operation would allow Blackstone to shore up its position in Spain. The US fund has become one of the stars of the real estate sector this year, having closed some of the most high-profile transactions in recent months (…).

Of the (14) hotels that Blackstone purchased from Sabadell, six are located in the Canary Islands (two in Tenerife and four in Gran Canaria) and the rest are located in Cataluña (in Sitges and Roses), the Community of Valencia (in Benidorm and Valencia), Málaga (two) and another two in Mallorca and Madrid (…).

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

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