Christie & Co: Hotel Investment Amounted to €4.9bn in Spain in 2018

13 February 2019 – Press Release

According to data available to Christie & Co, total hotel investment in Spain in 2018 amounted to €4,860 million, across a total of 223 transactions (surpassing the 185 transactions registered in 2017). That represents an average price per room of €128,000 and an increase of 24.6% in the total investment volume versus 2017, positioning Spain in second place after the United Kingdom (where investment amounted to £6,500 million), but ahead of Germany for the first time (where €4,000 million was invested).

In terms of investor profile, the report highlights the importance of investment firms as the largest source of capital in 2018, representing 53% of the total investment, with more than €2,560 million (up from 42% in 2017). Hotel companies, with 24% of the total investment figure (vs. 20% in 2017) are in second place, and REIT companies are in third place once again with 15% (vs. 16% in 2017). Furthermore, regarding origin, it is worth noting that investment from domestic players decreased in comparison to the previous year (35% in 2018 vs. 51% in 2017), to be replaced by an increase in US investors (40% in 2018 vs 23% in 2017) and the entrance of new investors from Thailand (8%) and México (4%).

The report also emphasizes how the estimated investment figure was greatly increased by portfolio transactions and significant assets, which represented more than 60% of the investment volume across the whole country. Blackstone, which was the main player in 2017 with the purchase of the HI Partners portfolio (€630 million) was again a protagonist in 2018 with the purchase of 48 hotels from the Hispania REIT portfolio, for €1,900 million.

Likewise, transactions such as the purchase of the Atom Hoteles portfolio, the joining of the Chinese group Gaw Capital and the increase in the stake of Omega Capital in the Hospes hotel chain, the 9 urban hotels in the Silken portfolio acquired by CBRE Global Investment Partners and Pygmalion Capital Advisers LLP, the takeover of NH Hotel Group by Minor International, and the purchase of Hotel Villa Magna by the Mexican REIT RLH Properties for €210m (with a record price per room of €1.4 million) caused the total volume transacted in Spain in 2018 to once again beat all the established standards (…).

Finally, the analysis shows how almost 93% of the transactions carried out in 2018 (vs. 90% in 2017) were concentrated in the same six Spanish regions as in the previous year: the Canary Islands (29.6%), the Balearic Islands (21%), Andalucía (16.5%), the Community of Madrid (12.9%), Cataluña (6.8%) and the Community of Valencia (6.3%). Regarding the average price per room per region, the Canary Islands led the ranking in the resort market, with €140,000 per room, while the Community of Madrid led in the case of urban destinations with an average price of over €200,000 per room.

Original story: Press Release

Translation: Carmel Drake

Oceanwood: Supported By 42%+ Of NH’s Shareholders

16 June 2016 – Expansión

The investment fund Oceanwood is gaining support in NH in its crusade against the Chinese group HNA – the Spanish hotel chain’s majority shareholder with its 29.5% stake – and now has the backing of more than 42% of the shareholders, who will vote in favour of its proposals at the next General Shareholders’ Meeting scheduled to be held on 21 June.

Specifically, Oceanwood, with its 11% stake, will be supported by high profile shareholders such as Hesperia and Henderson, as well as other institutional investors, according to market sources.

At the Spanish chain’s next General Shareholder’ Meeting, a vote will be taken, at Oceanwood’s petition, regarding the departure of HNA’s four directors, including Charles Mobus – Co-Chairman of NH – due to a possible conflict of interest that has arisen as a result of the Chinese group’s recent purchase of Carlson.

The fund has proposed that Paul Johnson, Fernando Lacadena, María Grecna and José María Cantero de Montes-Jovellar take over from the Chinese directors. NH’s share price fell by 3.37% on the stock exchange yesterday, to €4.16 per share.

Original story: Expansión (by R.Arroyo)

Translation: Carmel Drake

Oceanwood Becomes NH Hoteles’ 2nd Largest Shareholder

29 April 2016 – Expansión

The British fund manager Oceanwood Capital Management has strengthened its shareholding in NH Hoteles to obtain a 10% stake in the hotel chain, whereby overtaking the second largest shareholder, Hesperia, which holds a 9.1% stake. Oceanwood has informed the market that it owns 10% of the share capital, split between shares (8.746%) and financial instruments (1.254%), compared with the 7.58% stake that it held before. According to the latest data from the CNMV, the group has 350 million voting rights, which are worth more than €1,510 million, at market prices.

In addition, the co-Chairman of NH Hoteles, José Antonio Castro, the Chairman of Grupo Inversor Hesperia, has reported the purchase of 130,000 indirect shares with a unitary value of €3.60, which represents a total price of €468,000. Castro acquired these shares at a 20% discount with respect to yesterday’s closing price.

Of the twelve members that currently sit on the Board of Directors of NH Hoteles, besides the CEO, who serves as an Executive Director, there are four representatives from HNA, two from Hesperia, one from Oceanwood and four independent directors. Moreover, at its next general shareholders’ meeting, NH Hoteles will propose the appointment of Taisa Markus as an Independent Director, and so the Group’s Board will once again comprise 13 members.

HNA continues growing

Meanwhile, the main shareholder of NH Hoteles, the Chinese group HNA Group, with a 29.5% stake, has agreed to buy the hotel business of Carlson Rezidor, the thirteenth largest hotel chain in the world by size, according to the Hotels ranking and the owner of brands such as Radisson, Park Inn and Park Plaza.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

NH Has Raised Its Room Rates By Between 15% & 40% After Renovating Hotels In Spain

13 February 2015 – Expansión

The CEO of the NH hotel Group in Spain, Hugo Rovira, says that “customers are not fools, if you offer them quality, then they are willing to pay for it”, but he recognises that “if you give out peanuts, then you will attract monkeys”, after sharing his opinion that “retaining customers through low prices is not sustainable, there will always be cheaper competitors”.

The NH Hotel Group is spending 25% of its turnover on the renewal of its gastronomic offer, a major commitment for the hotel chain, which regards high quality gastronomy as the “saviour” of the sector as a means of differentiating itself.

And so it is with good reason that NH has invested almost four million euros in the renovation of its gastronomic offer, a fundamental part of the transformation that the chain is undertaking in virtually all of its hotels.

The renovation of its facilities has resulted in “an increase in the room rates at NH hotels across the country, of between 15% and 40% of the original cost, depending on the establishment”, according to the CEO of the NH Hotel Group in Spain, Hugo Rovira.

Rovira stresses that “it is hard to see how it could have got any worse in Spain” and that the commitment to high quality culinary tourism has led to the “salvation” of the sector, differentiating NH accommodation thanks to its wide-ranging gastronomic menu, without renouncing the commitment to offer customers the best service.

“Coffee for everyone is not good” said Rovira categorically to journalists on Thursday morning at a business breakfast. Specifically, the executive was referring to NH’s decision to provide a top class service both in room and in its restaurants.

By way of example, Roviro explained that NH continued to serve the best products in its minibars throughout the crisis and generated more or less the same volume of sales, with an increase of up to 20% in recent years.

Rovira also wanted to highlight the trend towards recovery in the Spanish market and he noted a “slight recovery”, although he made it clear that “we still have a long way to go, but at least we are on the right track”.

Positive outlook for 2015

In fact, the outlook for 2015 in our country is “good”, according to the CEO, who said that results from the last quarter of 2014 showed signs of recovery “both in terms of corporate clients and families”.

And he said that “clients are not fools, if you offer them quality, then they are willing to pay for it”, but he recognises that “if you give out peanuts, then you will attract monkeys”, after sharing his opinion that “retaining customers through low prices is not sustainable, there will always be cheaper competitors”.

NH seeks to differentiate itself and continue to maintain its image of high quality service through two clear commitments (a line of restaurants that serve products with Designation of Origin (Denominación de Origen or DO) and “show-cooking” or “Domos”, led by renowned chefs and apprentices from the hotel chain’s culinary school).

Renovations and relaunches

The NH Hotel Group is immersed in its renovation and relaunch plan, for which it has a total budget of €220 million to spend between 2013 and 2018; 55 hotels have signed up to the plan, of which 20 are located in Spain.

Other lines of action, such as the so-called “open bars” represent another model for the local market, as the company offers a service “similar to those provided in VIP lounges at the airport” in which clients can access “self service” bars.

Original story: Expansión

Translation: Carmel Drake