Redevco and SFP launch Next Gen Stays Iberian Hotel JV

Following a first close, a fund managed by SFP has indirectly taken a majority stake in ‘Next Gen Stays,’ currently comprising a seed portfolio of six assets in Lisbon, Porto, Bilbao, Malaga and Seville. The strategy is targeting a net levered IRR of 15%-plus over a five-year period and aims to build up a portfolio of around €300 mln, it said. 

Hannah Evans, investment director at Redevco, said its value-add Next Gen Stays strategy was an example of Redevco’s focus on repurposing assets to create places in urban locations. 

The assets are leased to professional, tech enabled hotel operators and redeveloped to create sustainable, good value accommodation targeting younger travellers, the JV explained. 'The target consumer base of millennials and Gen Z travellers are currently under-served by the hospitality sector, and this strategy is designed to cater for their demand of more flexible, sustainable and community driven stays. The refurbished hotels will be compatible with Redevco’s mission of making its entire real estate portfolio net carbon neutral by 2040.'

The SFP fund will look to increase its stake in the JV through further capital raises to acquire additional pipeline assets.

Philipp Braunwalder, CEO Swiss Finance & Property UK, which he stared with SFP's backing less than two years ago, said: 'Working alongside Redevco on yet another project tailored for the younger demographic has been both fulfilling and inspiring. We are excited to venture into the hospitality sector with a trusted partner by our side. At SFP, our commitment to providing innovative real estate solutions for future generations remains steadfast, while prioritising community enrichment and sustainable development.'

Patrick Brenninkmeijer, business development director at Redevco, said the JV will be working to capitalise on the resurgence and growth in the youth tourism and experience travel market.