The Spanish Hotel Sector will not Return to its Pre-Crisis Levels until 2022

The consultancy CBRE predicts that the markets most exposed to domestic demand, such as the Mediterranean region, will recover sooner, whereas the Balearic Islands and the Canary Islands, which depend more on international tourism, will take longer to recover.

The recovery of the Spanish hotel market following the Covid-19 pandemic will begin next year and the pre-crisis levels could be restored during 2022, according to the report “Spanish Market Outlook Covid-19”, prepared by the real estate consultancy CBRE.

In this sense, the hotel sector could experience a strong upturn in demand in 2021, with the recovery expected to span three different phases: first, domestic demand, then short-term demand, and finally, long-term demand.

Benidorm’s Hoteliers Consider not Opening until 2021

The current situation has led hoteliers in Benidorm to consider the option of not opening their establishments until 2021 since their income will not cover their expenses.

The current situation has led hoteliers in Benidorm to consider the option of not opening their establishments until 2021, or to open only a small part of them, so as not to incur greater losses due to the lack of footfall, to be able to cover the bare minimum of their operating costs.

This has been highlighted by Exceltur, which has affirmed that this destination, like the Balearic Islands, depends a lot on foreign tourism. The restriction of intra-European traffic for the next few months, the late relaxation of measures in the tourism sector and the implementation of health security measures on beaches will be very dissuasive for tourists. The consequences could be lethal and will affect tourism activity more than any other sector of the Spanish economy.

Spain will Defend the Creation of a European Fund to Refloat Tourism and Transport

The Government is going to take its proposal to the European Council to create a fund amounting to between €1 trillion and €1.5 trillion to boost the economic recovery after the pandemic.

The Government is going to take its proposal to the European Council to create a fund amounting to between €1 trillion and €1.5 trillion to boost the recovery after the coronavirus pandemic, focusing on infrastructure and tourism.

The fund would be used to finance reconstruction initiatives with a special focus on the sectors most affected by the cessation of activity and the lockdown measures, such as transport and tourism.

CaixaBank Granted Loans Amounting to €2.2bn to Hotels in 2018

19 February 2019 – Expansión

CaixaBank Hotels & Tourism granted loans amounting to €2.186 billion to the Spanish hotel sector in 2018, a figure that represents an increase of 46% with respect to the previous year. Moreover, 2,800 operations were carried out, up by 8% compared to 2017. The Balearic Islands and Cataluña are the autonomous regions that received the most loans.

Original story: Expansión

Translation: Carmel Drake

Spain sets new foreign tourist arrival record for sixth consecutive year

4 February 2019

A total of 82.8 million people visited the country in 2018, and spent more on average than in 2017

For the sixth year in a row, Spain has set a new record for foreign tourist arrivals. There were 82.8 million international visitors last year, a 1.1% rise from 2017, according to new figures released on Friday by the National Statistics Institute (INE).

There is renewed competition from destinations such as Turkey, Tunisia and Greece

Despite the emergence of competing destinations and some adverse weather, there was a surge in arrivals in the last quarter of the year, particularly in December.

And figures show that tourist spending grew at an even faster pace, for a total expenditure of nearly €89.9 billion, representing a 3.3% rise from 2017.

The numbers come close to the ideal situation that the government and the tourism industry are aiming for: greater spending by tourists, but not so many arrivals as to create saturation, stretch public services thin and lead to local expressions of tourist-phobia.

The Industry, Trade and Tourism Ministry noted that average daily spending by individual tourists grew 7.4% to €146. This figure is a better approximation of what tourists actually spend in Spain, as the total expenditure figures also include plane fare, which is paid in the country of origin.

Tourism from the United States grew 11.8%

As for the average duration of the stay, it went down from 7.7 days in 2017 to 7.4 days in 2018.

The growth rate for international arrivals has also slowed down considerably: 1.1% from 2017 to 2018, compared with 8.7% from 2016 to 2017. This is partly due to renewed competition from destinations such as Turkey, Tunisia and Greece, which attracted more visitors from Britain and Germany, the two main source countries of tourism to Spain.

In 2018, there were 11.4 million German tourists in Spain, a 4.1% drop from the previous year, while the number of British visitors declined by 1.6% to 18.5 million. Tourism from Scandinavian countries dropped 0.7% to 5.7 million.

But these drops were offset by a jump in visitors from other countries. Tourism from the United States grew 11.8% to reach close to three million. There was also a 6.3% rise in Russian visitors, who numbered 1.2 million.

Original Story: El País – Javier Salvatierra

Foto: Paco Puentes


Venezuelan Investors Buy a Building in Málaga to Convert it into Tourist Apartments

30 January 2019 – Diario Sur

Operations involving the sale and purchase of buildings in the Historic Centre of Málaga, driven by the tourist boom in the capital, are continuing to rise. At the beginning of this month, this newspaper revealed the sale of the former Casa del Niño Jesús building to the company White Málaga, a group of investors of Jewish origin, who have set their signs on the city for the development of real estate projects, encouraged by the recovery of the market and advised by the consultancy firm Salvago Advisors. All indications are that that property, which used to be owned by the Church, is going to become a project for tourist apartments, like the many others that are already operating or being constructed in the Centre.

And the same thing looks set to happen to the building located at number 22 Plaza de la Merced, on the northern corner with Calle Victoria. According to reliable sources, that property has been acquired by the company Orinoquia Real Estate, which is backed by investors from the Capriles group, a family saga of Venezuelan businessmen living in Spain with million-euro investments in the country’s major capitals such as Madrid, Barcelona and Valencia. This sale and purchase operation, whose amount has not been disclosed, has been managed by the real estate consultancy Savills Aguirre Newman (…). .

According to sources consulted by this newspaper, the plan is to convert the property into tourist apartments, which could be operational within just four months. The same sources reveal that the project to refurbish the building, which is in a good condition, is very advanced and the new owners are just waiting for the building permit to be granted by the Town Hall.

The building has a grade 1 listing protection and forms part of the northern façade of the Plaza de la Merced, which makes up the so-called Casas de Campos. The property dates back to the 19th century and bears the name of its builder, the promoter of the era, Antonio Campos (…).

Economic injection

This apartment project is going to be carried out by the Socimi (…) Orinoquia Real Estate, in which the Capriles injected an initial investment of €40 million to develop businesses in the first-rate tourist apartment sector.

The real estate business of the Capriles family in Spain comprises luxury housing development and renovation projects, although it is also worth highlighting their €5 million investment in the Bluemoon tourist apartments in the centre of Valencia. Their corporate network in the country is made up of more than twenty companies dedicated to real estate development, the sale and purchase of buildings and rental. Together, they have assets amounting to €125 million in total, according to information published in recent months (…).

Original story: Diario Sur (by Jesús Hinojosa)

Translation: Carmel Drake

Apple Leisure Group Debuts in Spain with its Purchase of a Majority Stake in Alua Hotels

23 January 2019 – Revista 80 Días

The US group is one of the largest managers of accommodation in the Caribbean. This purchase allows it to enter the vacation segment and the European market.

Apple Leisure Group (ALG), one of the largest hotel investors in the USA, has acquired a majority stake in the share capital of Alua Hotels and Resorts, the hotel group founded in 2015 by its main executives and the private equity fund Alchemy Partners. The amount of the purchase has not been revealed, although the joint operating result of the chain’s main hotels amounted to €6 million in 2017. Given that the properties are located in areas with high tourist demand and good forecasts, the amount of the operation could have exceeded €40 million, based on the multiples that are typically used for this type of transaction.

With this acquisition, ALG is entering the European market through the sun and beach holiday segment. And it is doing so in a country such as Spain, which receives more than 80 million tourists per year in search of that kind of offer. Alua Hotels has 11 hotels located in Mallorca, Ibiza, Fuerteventura and Tenerife, together with an apartment building in Ibiza.

In total, ALG will manage more than 3,000 4-star hotel rooms, focused on the type of tourist who wants a superior service to that usually found in the average accommodation establishments in beach areas. The US company is planning to undertake more acquisitions in the European market and has announced that it wants to become a reference player in the main destinations in the Mediterranean (…).

Apple Leisure Group is one of the most important investment conglomerates in tourism in the USA. It used to be owned by the investment fund Bain Capital (…), which sold it in 2017 to the funds KSL Capital Partners and KKR for an undisclosed sum. (…). According to data from the conglomerate, it manages 14 brands and handles more than 3.2 million passengers per year (…). Its turnover exceeds USD 3 billion per year (…).

Original story: Revista 80 Días 

Translation: Carmel Drake

Hotels Suffer from the First Decrease in Overnight Stays since 2012

24 January 2019 – Expansión

The record number of tourists registered in 2018 has not removed the bitter taste from the mouths of Spanish hoteliers, who are starting to suffer from symptoms that the sector is worn out. In 2018, Spanish hotels recorded the first decrease in the number of overnight stays in six years. A moderate decrease, of –0.1%, according to data from INE, but one that has not been seen since 2012, when Spain was in the midst of the financial crisis.

Spain is receiving more tourists than ever, and they are increasing their spending year on year, but they are also gradually reducing their average stay, and some of the demand is opting for alternative destinations, such as Turkey, which are competing on price, which is eroding the margins of many hotels at home (…).

According to data from Exceltur, Spain lost 21 million overnight stays in 2018, due to a decrease in the average stay. The boom in low-cost airlines, amongst other factors in the sector, has favoured the democratisation of tourism. Increasingly more people are travelling, but they are doing so for shorter periods. Whilst in 2008, the average stay was 9.4 days, it is now 7.4 days.

That change can be observed most easily amongst overseas tourists, who account for 65.8% of overnight stays and who decreased the number of nights spent in Spain by -0.4%, whereas domestic tourists increased their overnight stays by +0.4%.

The change in trend is being observed primarily in the traditional beach and sun markets, and in the most important months for the sector, in the height of the summer. In the Canary Islands, the primary destination for international tourists, accounting for almost one third of all overnight stays, visits by foreigners decreased by 3.6%(…).

According to explanations provided recently by the Head of Research at Exceltur, Óscar Perelli, these decreases reflect “the recovery of competitor countries”. Hotels, especially those on the beach, are being affected by competition in terms of prices from countries such as Turkey, Egypt and Tunisia. Those markets have recovered around 12 million tourists in recent years and they are still 20% below the levels they reached before their own crises (…).

Travellers from the United Kingdom and Germany account for 46% of all of the overnight stays made by non-resident visitors, and yet, there was a -0.9% decrease last year in the case of British tourists.

As a result, many hotels are trying to compete through promotional packages and cost reduction policies, and so prices barely increased in 2018. The Index of Hotel Prices from INE reflects a 1.5% increase in hotel tariffs, barely three decimal points above inflation for the year, making it the lowest rise in prices since 2013.

In terms of tourists who increased their hotel stays by the most, those who have to travel long distances, including visitors from the US (6.1%) are also the travellers who spend the most (€113 per tourist per day, compared with €98/tourist/day for those visiting from traditional markets), and so representatives in the sector recommend focusing promotional strategies to attract tourists from those countries.

Original story: Expansión (by Inma Benedito)

Translation: Carmel Drake

CBRE: Hotel Investment Set a New Record of €4.9bn in 2018

10 January 2019 – Expansión

The hotel segment broke a new record last year thanks to two key operations: the takeover of Hispania by the US fund Blackstone and the takeover of the chain NH by the Thai firm Minor.

The hotel segment made history again in 2018 with a record investment volume of €4.9 billion, which represented an increase of 33% with respect to the previous year, boosted by the US fund Blackstone’s takeover of the Socimi Hispania and the Thai firm Minor’s takeover of the Spanish chain NH.

According to data from the consultancy CBRE, last year, 240 hotel assets were transacted in Spain spanning 36,500 rooms in total, which represents growth of 17% and 30%, respectively. In other words, more and larger-volume operations were closed in 2018 than in 2017.

The hotel market whereby completed five extraordinary years, driven by the excellent evolution of tourism. Spain is a market leader in this activity, with 81.9 million international visitors in 2017 and 81.2 million last year (…).

The most active investors in 2018 were institutional players, which accounted for 66% of operations, followed by hotel groups (21%) and private equity and family offices (13%). In the ranking of operations, the purchase of Hispania stands out, which ended up in the hands of Blackstone after the fund acquired more than 90% of that company. The US giant purchased the Hungarian-born magnate George Soros’ 16.56% stake in Hispania in April and, subsequently, launched a takeover valuing the company at €1.992 billion. After successfully completing the takeover in September, Blackstone became the largest hotel owner in Spain, with a portfolio of 46 assets and more than 13,144 rooms.

After the purchase of Hispania, came the takeover of NH by Minor. Following that operation, the Thai group became the owner of a portfolio of 350 hotels in Europe and Latin America – 30% of which are in Spain.

Other significant operations also included the entry into the market of the Chinese group Gaw Capital, which acquired 50% of the Hospes Hotel Group, worth €125 million, teaming up with Omega Capital, the family office owned by Alicia Koplowitz, owner of the other 50% of the chain.

In terms of individual assets, the purchase of the luxury Villa Magna Hotel in Madrid stands out. The Turkish group Dogus sold it to the Mexican Socimi RLH, chaired by Allen Sanginés-Krause for €210 million.


The National Director of CBRE Hotels España, Jorge Ruiz, explained that, as well as the vertiginous sale of hotel assets, the notable investments in asset renovations stood out once again.

“The Spanish hotel stock is better equipped today to face the challenges on the horizon, such as the recovery of competing destinations, the impact of a hard Brexit and a slowdown in the Spanish economy”, he said.

Ruiz explained that, unlike during the previous upward cycle, hoteliers have opted to invest in renovating their portfolios, which will allow them to increase their prices.

In terms of the type of assets, vacation hotels accounted for 64% of investments, following the trend established in 2017, due in large part to the purchase of Hispania, whose hotels are located primarily on the Spanish islands and along the coastline. Investment in urban assets went from 40% to 36%. In 2018, the main star asset were 4-star hotels, which accounted for 64% of operations, followed by 5-star hotels, with 21%.

Star destinations

By destination, the Canary Islands accounted for 35% of investment, followed by the Balearic Islands, with 20%. The third-ranked location was Madrid, with 12%, followed by Barcelona (8%) and Málaga (5%) (…).

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

The Boom in Tourist Apartments Cools Down

3 December 2018 – Eje Prime

The boom in Airbnb and other collaborative economy platforms has removed thousands of flats from the real estate market in recent years. The high returns that owners receive from the overnight stays of tourists are behind the phenomenon, which has contributed to a decrease in the supply of rental homes available for residents and, therefore, to an increase in rental prices, especially in the large cities. Nevertheless, this phenomenon appears to have peaked.

At least that is according to the latest results from the Tourist Apartment Occupancy Survey published by Spain’s National Institute of Statistics (INE). In October, Spain had 133,567 tourist apartments registered as such in the corresponding registers of the tourism councils of each autonomous region, which represented a decrease of 6,976 units with respect to the same month in 2017.

The decrease in October is the third consecutive monthly fall and the sixth so far this year; it comes after a period of continuous increases, which started in 2015. The maximum stock of tourist apartments in recent years was recorded in July of this year, with 167,241 units, coinciding with one of the months during which this indicator rises the most. Nevertheless, in August, the number of registered apartments decreased by 3.2% YoY, before falling by 2.3% in September and by 5% in October.

The decrease in the number of establishments took place in the last year to October in the five autonomous regions with the largest supply of that type of apartment. In the Canary Islands, where 45,958 apartments were recorded in October, the YoY decrease amounted to 2.9%, with 1,350 fewer establishments.

The most marked decrease, amounting to 13.1%, was recorded in the Community of Valencia, which lost 3,662 apartments, bringing the total to 24,280. The decrease amounted to 1.2% in Andalucía (with a stock of 18,442 apartments), 10.3% in the Balearic Islands (to 17,479 apartments) and 5.6% in Cataluña (to 10,895 apartments).

On the other hand, although the general trend is a decrease, in some autonomous regions, the volume of tourist apartments is continuing to rise, with increases in the double digits in some places, such as in the case of Cantabria, with an increase of 27.6% compared to October 2017 and of 14.8% in Castilla y León.

Original story: Eje Prime 

Translation: Carmel Drake