Tag: Hotel Ritz

Chinese Group Gaw Capital Joins Forces with Alicia Koplowitz to Target Hotel Sector

25 July 2018 – Expansión

The Chinese fund manager Gaw Capital Partners is making its debut in the Spanish hotel sector hand in hand with Omega Capital, the family office owned by Alicia Koplowitz. Specifically, the investment firm specialising in real estate assets has purchased 50% of the Hospes Hotel Group, worth €125 million, and has created a joint venture together with Omega Capital – with which it will share the ownership – for the development and expansion of the Spanish chain.

Before the entry of Gaw Capital Partners, the hotel chain was owned in equal parts by Fonsagrada – a company owned by the Koplowitz family -; the Areyhold group, owned by the Yera family; and Telescom, owned by the Hernández López family.

Hospes, founded in 2010, owns nine boutique hotels located in Alicante, Cáceres, Córdoba, Granada, Madrid, Mallorca, Salamanca, Sevilla and Valencia. The company’s establishments, which are all four- and five-star properties, are located in unique buildings that are rich with historical and architectural heritage.

According to the results for 2016 (the latest available in the Mercantile Registry), the chain generated an operating profit of €10.5 million, up by 18% compared to the previous year, and sales of €30 million.

Growth in Europe

The purchase of 50% of Hospes by the Chinese fund has been carried out through the fund European Hospitality Fund I, managed by GCP Hospitality, its hotel division.

GCP Hospitality, founded by the shareholders of Gaw Capital Partners and by Christophe Vielle in 2008, currently manages 39 assets (hotels, apartments and university campuses) and 7,450 rooms around the world.

GCP Hospitality, led by Vielle, has regional offices in Bangkok (Thailand), Beijing (China), Hong Kong (China), Perth (Australia), San Francisco (USA), Singapore and Rangoon (Myanmar).

Vielle, CEO of GCP Hospitality Management, explains to Expansión that, with the good outlook for the European tourism industry, the company is “actively” studying ways of expanding its portfolio across the Old Continent.

“We will take advantage of the reputation of the Hospes Hotel Group and our international network to raise the profile of the brand”, says the CEO GCP Hospitality Management.

In this sense, the evolution of the Spanish tourism sector in recent years has been spectacular. Spain recorded a new milestone last year with the arrival of 82 million international tourists and has also registered eight consecutive years of growth in terms of tourism GDP. For Vielle, the acquisition of Hospes Hotel Group is an example of the “solid track record” of GCP Hospitality in the launch and management of successful hotels and first-rate brands.

Since its creation in 2005, Gaw Capital Partners has raised almost USD 10 billion (€8.557 billion) and currently has USD 18 billion (€15.403 billion) in assets under management. The fund manager, which is investing in different segments of the real estate market, has a significant presence in the Asia Pacific region and in the USA.

Promoting the brand

Meanwhile, the alliance with the Chinese investment fund manager allows Omega Capital to boost its investments in the tourism sector.

Hospes is not the only firm that Koplowitz is backing in the hotel sector through her family office. Specifically, Omega Capital, together with the Orient Express group (now Belmond) purchased the Madrilenian Hotel Ritz for €125 million in 2003. More than a decade later, in 2015, Omega Capital and Belmond sold that iconic hotel to a consortium formed by the Olayan family, from Saudi Arabia, and the Mandarin group, which manages the establishment, for €132 million. The property is currently closed for refurbishment.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

The Hotel Ritz in Madrid Closes its Doors for a €99M Refurb

27 February 2018 – Invertia

Following the purchase of the Ritz hotel in 2015 for more than USD 148 million (€120.7 million), its current owners, Mandarin Oriental and the Saudi group Olayan, announced that they would subject the property to an extensive renovation to significantly improve its facilities and services.

The investment by Mandarin Oriental, which administers the hotel under a long-term management agreement, quantifies its stake in the renovation at USD 60.5 million (€49 million), which is going to be financed through an appropriate combination of capital and debt.

Whilst the hotel is closed, its staff will participate in training programs and/or will be sent on temporary assignments at other Mandarin Oriental establishments, in preparation for the grand reopening.

Following the remodelling, in which the Spanish architect Rafael de La Hoz is participating, along with the French designers Gilles & Boissier, the hotel will have 106 rooms and 47 suites and Mandarin Oriental will be added to its current name ‘the Ritz’.

The intention of the owners is to improve the facilities and services at the hotel but to conserve its essence, which is defined by the “Belle Epoque” style of the original building.

Sources at the Hotel Ritz have informed Efe that the construction work will involve the remodelling of the dome and the installation of a swimming pool, amongst other aspects.

The same sources have said that the furniture and objects of value at the hotel will be stored in warehouses in Madrid and that a decision will be taken in the future as to whether some of them will be sold directly or through auction.

The hotel, located in the so-called “Golden Art Triangle” of Madrid, has hosted members of royalty, politicians, magnates and celebrities since its inauguration in 1910.

Original story: Invertia

Translation: Carmel Drake

Iberdrola Puts Hilton Diagonal Mar Hotel Up For Sale

21 March 2017 – Expansión

Iberdrola has hung the “for sale” sign up over the jewel in the crown of its real estate subsidiary: the building that houses the Hotel Hilton Diagonal Mar, a four-star property located at the intersection of Calles García Faria and Taulet, in the Barcelona neighbourhood of Diagonal Mar.

The company has contracted the real estate consultancy firm Irea to sell the asset, which has an asking price of more than €150 million, according to market sources.

These sources also indicate that the process will be restricted and that they will look to attract four or five candidates interested in acquiring the asset.

The building that houses the Hilton Diagonal Mar is the largest asset in the real estate subsidiary’s current portfolio, behind Torre Iberdrola in Bilbao, which is the corporate headquarters of the multinational company and is therefore strategic for the energy group and not susceptible to being sold.

Iberdrola’s real estate subsidiary has different types of assets in its portfolio, ranging from primary homes and tourist apartments, to offices, industrial warehouses and shopping centres. Currently, Iberdrola Inmobiliaria has a portfolio of real estate assets under management with a combined gross leasable area of more than 200,000 m2.

In Barcelona, the company owns the office buildings Torre Auditori and Torre Marina (in the final phases of construction).

The hotel now up for sale, work of the architect Oscar Tusquets and opened in 2005, was developed by the real estate subsidiary of Iberdrola.

Agreement with Hilton

Just before the construction work was completed, the company reached an agreement with Hilton whereby the hotel chain would take charge of the operation of the establishment for 20 years.

The Hilton Diagonal Mar has almost 420 rooms and around 20 suites, as well as multi-functional meeting rooms and a ballroom with capacity for 1,000 people. The building, which is oriented towards corporate events and conferences, is located opposite the Diagonal Mar shopping centre, a stone’s throw away from Barcelona’s International Convention Centre (CCIB) and 18 km from the airport.

Real estate investment in hotel assets returned to record figures in 2016. In this way, almost a quarter of all investment in commercial assets was linked to hotel assets.

Specifically, last year saw investment volumes of €2,200 million, the second highest amount ever recorded, thanks to a boost from some significant transactions, such as the sale of Merlin’s hotel portfolio – comprising 19 hotels and 3,645 rooms – to Foncière des Murs for €535 million. Likewise, last year, the Hotel Villa Magna was sold to the Turkish group Dogus for €180 million, in what is still the highest grossing operation to date in terms of price per room (€1.2 million), ahead of the almost €800,000 per room that was paid for the Hotel Ritz in 2015. (…).

Original story: Expansión (by R. Arroyo and M. Á. Patiño)

Translation: Carmel Drake

Irea: Hotel Investment Amounted To €2,470M In 2015

15 January 2016 – Expansión

Hotels are establishing themselves as one of the most sought-after assets in the real estate sector. The historically high RE investment level in 2015 boosted the hotel segment in particular, which accounted for 20% of total commercial real estate investment volumes during the year – excluding residential – compared with 11% in 2014, according to a report about the hotel investment market in 2015, prepared by the consultancy Irea.

Last year, 132 hotels were sold containing 29,081 rooms for €2,470 million, significantly more than the 50 operations that were closed in 2014. Moreover, properties worth €144 million were sold for conversion into hotels. In total, the hotel investment market amounted to €2,614 million in 2015, compared with €1,091 million a year earlier. Spain was the third most active country in Europe, behind the UK and Germany, and accounted for 14% of all European investment, up from 7% a year before.

54% of hotel investment in 2015 was focused on the holiday segment, which reflects “a return to normality for the Spanish market, where more sun and beach properties have traditionally been sold than city hotels”, according to Miguel Vázquez, Managing Partner of Hotels at Irea. This trend will be maintained in 2016.

The Canary Islands was the most sought-after region in 2015, accounting for 28% of total investment. It exceeded Madrid and Barcelona, where political uncertainty put investors on alert. By category of hotel, 62% of investment in the sector was focused on four-star hotels, although unique individual assets, such as the Hotel Ritz in Madrid (pictured above), were also sold.

40 of the 132 hotels sold were transferred through portfolio operations – involving two or more assets – and the Socimis were the main purchasers, together with domestic and international hotel chains, willing to invest in strategic assets.

Another significant milestone in 2015 was the purchase of land in Málaga for the development of new hotels, which was seen for the first time since before the crisis. Nevertheless, Vázquez thinks that, “land purchases will be few and far between in 2016: right now it is more profitable to buy a hotel and renovate it than to construct one from scratch and financial institutions are not ready to provide finance yet”.

Debt portfolios

Nevertheless, the experts do expect that there will be more operations involving the sale of debt portfolios secured by hotels in 2016. They amounted to €466 million in 2015. (…).

Irea expects that 2016 will be a good year, but the firm thinks that it will be difficult for the strong figures recorded last year to be repeated. Madrid will continue to be the preferred investment target and capital inflows there may have exceeded €582 million in 2015. Barcelona, where investors perceive more risk, will remain frozen to investment in new projects. For existing hotels, record figures in terms of price per room may be reached.

Original story: Expansión (by Y. Blanco)

Translation: Carmel Drake

CBRE: Non-Residential RE Inv’t Exceeds €13,000M In 2015

28 December 2015 – Expansión

The Torre Espacio skyscraper, Gran Vía 32 retail store, the Plenilunio shopping centre and the Hotel Ritz in Madrid are just a few examples of the real estate assets that have changed hands in the last year and which have placed the level of real estate investment in Spain at levels never seen before.

Between January and December, investment in non-residential properties (in other words, in offices, shopping centres, retail premises, hotels, warehouses and logistics centres) amounted to €12,250 million, according to the consultancy CBRE; and 2015 is expected to close with a total volume of €13,000 million, an unprecedented figure in the sector in Spain.

Even though the volume of real estate investment was strong in 2014, with a total of €10,000 million – returning to the pre-crisis figure of 2007 – that amount was surpassed within the first nine months of 2015: between January and September, purchases involving assets worth €10,800 million were closed, up by 57% compared with 2014 and by €600 million compared with 2014 as a whole.

This record figure is explained by the return of international funds to the Spanish market, following their exit when the bubble burst (they have been returning slowly since the end of 2013), as well as the rise in a new type of company: the Socimis.

This type of company emerged in 2009 when legislation was created for the launch of these vehicles, inspired by the American REITs. Nevertheless, it was not until the reform (of that legislation) in 2012, that the first Socimis, which were primary managing family wealth, started to flourish. Two years later, the first large real estate companies debuted on Madrid’s stock exchange and there are now four such listed companies: Merlin Properties, Hispania, Lar España and Axiare. (…).

Indeed, one of these, Merlin Properties, has starred in the largest operation in the sector this year, which, despite being a corporate purchase, is included because of its real estate component: the purchase of Testa, formerly a subsidiary of the construction group Sacyr.

Excluding this acquisition, the sector recorded total investment of €7,621 million during the 9 months to September, after a very active summer (traditionally a period when very few operations are closed).

The largest operations included acquisitions of single assets, such as the Megapark shopping centre in Bilbao, which the Socimi Lar España purchased for €170 million, as well as the purchase of batches of properties, such as the Thunder portfolio, comprising two office complexes in Madrid and Barcelona, acquired by Axa Real Estate; and the purchase of 16 supermarkets leased to Dia and Carrefour by the fund Kennedy Wilson, which paid more than €85 million.

Hotels

Hotels have also experienced a significant boost in terms of investment this year. “In 2014, hotel investment amounted to €1,100 million; this year, we have already exceeded €1,900 million and we expect to close the year with a volume of €2,000 million”, said Mikel Marco-Gardoqui, from CBRE. (…).

The experts at the consultancy firm expect interest from the funds to continue into next year. “We think that investment will amount to around €10,000 million in 2016, although we expect to see fewer operations, because prices are going to increase (…)”, says Heriberto Terual, Director of Corporate Finance at CBRE.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Hilton To Open Hotel In Centre Of Madrid

11 November 2015 – Expansión

The US giant is set to debut its Double Tree brand in the heart of the capital, with a 61-room hotel on Calle San Agustín, which the Pérez Gil family will manage under a franchise agreement.

Hilton is joining the hotel battle in the centre of Madrid. The US group will debut its Double Tree brand in Madrid in 2016, with a hotel in the tourist centre of the capital.

Specifically, it will open a hotel in a building that currently houses offices on Calle San Agustín, Madrid. This building is owned by the Pérez Gil family, which also owns several other hotels in Madrid. The owner will take responsibility for the renovation of the building and will manage the four-star hotel under a franchise agreement.

Hilton, whose only presence in the capital until now has been near the airport, is moving into the centre to compete against Four Seasons and Mandarín, which are preparing to open hotels of their own in the Canalejas complex and in the Ritz, respectively. The US chain also participated in the bid to manage the Hotel Miguel Angel, but in the end that contract was awarded to Bluebay.

Original story: Expansión (by Yovanna Blanco)

Translation: Carmel Drake

CBRE: RE Investment Grows By 51% To €5,264M In H1 2015

6 July 2015 – Expansión

Five star hotels, commercial premises on the country’s most iconic streets, large shopping centres and office buildings. All of these assets have changed hands in recent months in the Spanish real estate market, which has been extremely active in recent months.

Between January and June, real estate investment (which includes offices, shopping centres and retail premises, logistics warehouses, hotels and residential assets) amounted to €5,264 million, according to the consultancy CBRE. That figure soars to €8,434 million if we include the purchase of the real estate company Testa by the Socimi Merlin Properties.

The amount represents an increase of 51% compared with the first half of 2014, a figure that itself represented a two-fold increase with respect the previous year. Thus, total investment during the first half of the year increased from €697 million in 2012 to €1,455 million in 2013, to €3,475 million last year and to more than €5,200 million in 2015, according to CBRE. (…).

By quarter, the volume invested in the second quarter (from April to June) was slightly lower than during the first quarter: €2,337 million compared with €2,928 million. “The decrease in the second quarter was due to the fact that some transactions were delayed and also because some very large deals were closed during the first quarter, including Gran Vía 32 and Plenilunio”, explains Paloma Relinque, Investment Director at CBRE.

By asset type, offices and retail assets (both large shopping centres, as well as shops on the main streets of Madrid and Barcelona) have featured in the largest deals. In the case of offices, highlights include the sale of Ahorro Corporación and Sareb’s headquarters on Castellana 89 (Madrid) to the March family for €147 million. In terms of retail premises, in April, the insurance company Axa paid €308 million to the Socimi Uro Property for 400 Banco Santander branches.

There have also been important transactions in the hotel sector, including the sale of the Hotel Ritz, which was transferred for €130 million. (…).

Types of investors

Although the investment growth trend seen in 2014 was repeated during the first half of 2015, there was a change in the mix of investors by nationality. Whilst at the beginning of last year, the more opportunistic US funds accounted for 53% of transactions, compared with British and German funds, which accounted for 5% and 1% of deal respectively; during the first half of 2015, US funds accounted for just 21% of total volumes, whilst investors from the UK accounted for 22% of deals, followed by Canadian funds (9%) and German funds (6%), according to CBRE.

Moreover, the Socimis Lar España, Merlin Properties, Hispania and Axiare are still the major players in the market for real estate investment. “The Socimis are performing very well, which is great for the sector because they purchase office buildings, for example, to refurbish them and add value, which improves the real estate stock”, says Lola Martínez, Director of Analysis and Investment Strategies at CBRE.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake