French listed property group Covivio, through its 52.5%-owned subsidiary Covivio Hotels, has purchased the 429-room, 4-star Iberostar Las Dalias hotel in Tenerife, Canary Islands, for €81 mln.
The asset was bought from a Starwood Capital affiliate and aligns with Covivio’s strategy of expanding its hotel portfolio in Southern Europe.
Situated on the popular Adeje coast, the hotel is leased to Iberostar until 2041 and offers a stabilised yield of 6.75%.
Built in 1985 and renovated in 2021, the property offers a restaurant, three bars, three swimming pools, a gym, squash and volleyball courts, and two meeting rooms with a capacity of up to 140 people.
The Canary Islands are Spain’s top tourist destination with 69.7 million overnight stays in 2023 (20% of the national total) and a year-round destination thanks to their mild weather. The Adeje coast is a major tourist area with nearly 11 million overnight stays in 2023.
The purchase marks Covivio’s first hotel acquisition since 2020 and signifies a renewed focus on the leisure segment within the hotel sector. The company increased its ownership of Covivio Hotels to 52.5% in the first half of the year and recently completed the consolidation of operating and property companies co-owned with AccorInvest.
