An unnamed institutional investor has awarded real estate manager Freo Group a €400m mandate to invest in Spanish hotels
Freo, which expects to fully invest the capital over the next three years, said it is “currently under exclusivity on a number of transactions, with a significant investment programme planned to reposition the hotels”.
The manager has created a new investment platform on behalf of the institutional investor, to target urban hotels in Barcelona and Madrid, as well as leisure hotels in popular tourist regions such as the Balearic Islands, the Canary Islands and the Costa del Sol.
Andrew Hunter, managing director and head of hotels for Freo, said “Covid has provided a significant temporary disruption to hospitality but we are long-term believers in the sector.
“The current surplus of investment capital and support packages for hotels means that we must do more than ride the cycle and our strategy is very targeted, looking only at quality locations with strong upgrade potential to provide a sound investment basis.
“However, we are also focused on value creation through efficiency and aggregation and will be looking at innovative new products and growth potential, as well as honouring our ESG ambitions by recycling and improving products, retaining and upskilling staff and creating more efficient assets to reduce environmental impact.”
Daniel Mayans, managing director and head of Spain for Freo, said, despite the disruption caused by the pandemic over the last year, Spain remains highly attractive to investors as a result of its relative maturity as a market alongside its potential for further growth.
”The leisure market in Spain is one of the most important in Europe and has a number of excellent operators with inspiring product, but there is space for much more diversity, internationalism and next-generation product.
“Having completed a significant number of transactions and asset management programmes to deliver best-in-class and futureproofed assets, we are excited to continue our expansion and look forward to announcing further acquisitions in the near term,” Mayans said.
As part of a broader plan, Freo said it is also seeking investment opportunities in other countries in the European Economic Area, including the UK, France and Italy.
To read the digital edition of the latest IPE Real Assets magazine click here.
