Transaction / Assets Seller Buyer € MM
La Zagaleta To Replicate Its Luxury Marbella Complex In Sotogrande
8 January 2016 – Expansión
La Zagaleta, one of Europe’s most exclusive residential developments, located on the Costa del Sol, is going to replicate its business model in Sotogrande (Cádiz), the other major hub for luxury real estate in Andalucía.
Through its English subsidiary, the group has acquired the prestigious Valderrama golf course from the British company MGI for €40 million. Moreover, it will invest another €200 million in the development of the project.
As an indication of its exclusivity, this sporting venue is the only place that has hosted the Ryder Cup in Continental Europe (in 1997). The Ortiz Patiño family converted it into a first-class facility in 1984 and since then the complex has been sold several times. La Zagaleta will continue to lease the venue to the golf club that currently operates there.
Several companies are included in the operation, which encompasses the residential estate, the land that is still undeveloped and the project for a new golf course in the municipal area of Castellar, in other words, Valderrama II. In total, the site covers 220 hectares. This plot is one of the few that has been granted a licence by the Junta de Andalucía to construct homes after IU (la Izquierda Unida or United Left (Political) Party) – which led the Ministry for Tourism under the previous government – approved a restrictive regional policy to limit urban expansion.
Residential and tourist properties
La Zagaleta’s plans include placing it in the “current golf course’s frame of reference” and constructing a residential tourist and hotel resort “in keeping with the quality standards synonymous with La Zagaleta”. Thus, it will develop villas and homes on this land, which will require additional investment of €200 million over the next ten years.
According to a statement by the company, all of the necessary permits and licences are in place to begin the work, but the start date has not been confirmed yet because the design phase is still being completed. In any case, the design “will be inspired by the philosophy and values of La Zagaleta”, an urbanisation that is accessible only to those individuals who have assets worth ten times the value of the property that they acquire.
The CEO of the firm in Spain, Jacobo Cestino, said that “this operation strengthens our leadership position in the luxury property market and links us to one of the most prestigious golfing brands in the world”. Similarly, he said that the company has not ruled out acquiring other brands in the medium term.
La Zagaleta, founded by Enrique Pérez Flores and currently chaired by Oswald Grubel, the former CEO of UBS and Credit Suisse, has 235 mansions with a market value of €1,800 million, which increases to €3,000 million if we include the two golf course and other facilities at the 900 hectare site.
Original story: Expansión (by Rocío Ruiz/Lidia Velasco)
Translation: Carmel Drake