Spanish REIT Hispania has taken the next step in its strategy to become one of the top hospitality landlords in Spain following the flotation of its €790 mln joint venture with hotelier Grupo Barceló on the Madrid Stock Exchange.
The joint venture, Bay Hotels & Leisure, is also structured as a Socimi, or the Spanish version of a real estate investment trust. The joint venture began trading on the alternative board of Madrid Stock Exchange on Monday morning.
Bay Hotels & Leisure owns 21 hotels with 7,000 rooms, two shopping centres and a marina concession area, with a total value of €790 mln. The assets are located in the key tourist destinations on the Canary Islands, Balearic Islands and in Andalusia.
The hotel REIT is valued at €494 mln, based on 93 million shares priced at €5.29 each.
The latest addition to the portfolio came on 26 June. This was Hispania's €20 mln acquisition of the 275-room Fergus Tobago Hotel on the island of Mallorca. Hotelier Fergus will continue to operate the hotel on a lease contract with both a fixed and variable component. All but one of the other joint venture assets are operated under the Barceló brand.
Joint venture
Hispania and Grupo Barceló teamed up in April 2015 to create the country's first hotel REIT focused on the holiday resort segment. Hispania has an 80% stake in the joint venture, to which it has contributed its Barceló-branded hotels. Overall, Hispania's hotel holdings comprise 11,296 rooms across 39 hotels.
Founded by private equity investment firm Azora in 2014, Hispania registered as a Socimi two years later. Hispania had €1.7 bn of office, hotel and residential assets under management at end-2016.
Hispania's mandate allows it to own other real estate asset types such as shopping centres and logistics but the company has not made any investments so far in these segments.
However, Hispania is selling down roughly €500 mln of its office holdings in line with its strategy to focus on hotels in a bid to generate added value.
The company's Spanish peer Colonial Inmobiliare is believed to be one of the contenders for the portfolio which is concentrated in Madrid and Barcelona, PropertyEU's sister publication EuroProperty reported last week. With an office portfolio valued at €8 bn at end-2016, Barcelona-based Colonial is also planning to become a REIT.
Hispania announced last month that it had sold a single office asset – the Aurelio Menendez building in Madrid to an undisclosed buyer for €37.5 mln.
The entire building, which totals 4,700 m2, is leased to Spanish law firm Uría Menéndez. Hispania acquired the office in October 2015. The sale price represents 39% over the value of the last appraisal.
