HOTEL INVESTMENT IN SPAIN - HOTELS - 1H | 2018 - Colliers International
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
HOTELS HOTEL INVESTMENT IN SPAIN 1H | 2018
“Hotel investment in first half of 2018 reaches 1,830 million euros”
01 HOTEL INVESTMENT IN SPAIN
In the first half of 2018 hotel investment was once • The extraordinary level of activity in purchases and
again remarkably strong. sales of hotel portfolios.
• The leading role played by Blackstone, which in
With a total investment of 1,830 million as of the end
recent months has become itself as the most active
of June, Spain posted the second highest semi-annual
investor in the Spanish hotel market.
results its history, 13% below the absolute record
achieved in 2017. • The limited investment activity in Barcelona and
Madrid compared to previous years.
Considering the last 12 months (Jun17/Jun18),
• The strong inertia at the start of the second half
investment amounts to 3,633 million euros, which
of teh year, especially regarding the potential
shows that investor appetite for the Spanish market
completion of deals currently under way, such
remains at very high levels. Highlights of this first half-
as Blackstone’s offer for the remaining shares of
year are:
Hispania or Minor’s bid for NH.
TOTAL HOTEL INVESTMENT VOLUME 2013 - H1 2018 (€m)
4,500
3,907
4,000
3,500
3,000
2,614
2,500 2,184
2,104
2,000 1,830
1,500
1,081
792 1,061
1,000 697
500
0
2013 2014 2015 2016 2017 H1 2018
H1 H2
Source: Colliers International
PORTFOLIO INVESTMENT ACTIVITY Investment in hotel portfolios outperformed the
previous record (612 million euros, posted in the first
Purchases of hotel portfolios reached an investment half of 2017) by 71.4%.
volume of 1,0481 million euros, accounting for 60%
of total investment. Portfolio sales and purchases
became the highlight of the half-year and experienced
huge growth compared to previous periods.
1 Weighted by the percent of investment actually acquired. The amount of the investment is the GAV of the hotels located in Spain that are included in the
acquired portfolio.
Report on Hotel Investment in Spain
1H 2018 3
PORTFOLIO TRANSACTIONS VS. INDIVIDUAL ASSETS (H1’14-18) (€m)
2,000
1,800
1,600
1,400 612
1,200 1,048
1,000
800
609 32
600 74
1,082
400
699
595
200 453 434
0
H1 2014H H1 2015 H1 2016H H1 2017 H1 2018
Asset Portfolio Individual Asset
Source: Colliers International / Investment data on existing hotels
Although many of these deals have taken place in 3. Implementation of the strategy adopted by
the context of corporate transactions, the origins and the Accor Group (following in the footsteps of
motivations of buyers and sellers have been diverse other international chains) of separating hotel
and can be summarised as follows: management and ownership. This strategy resulted
in the sale in June of a 57.8% stake in AccorInvest
1. The acquisition by Hispania of 7 hotels (1,708 vehicle to an investor group led by the sovereign
rooms) belonging to the Alua hotel chain with an funds of Saudi Arabia (PIF), Singapore (GIC) and
asset value of 165 million euros, applying 100% of Colony. The acquired portfolio included 11 hotels
the investment capacity initially committed by its (1,572 rooms) located in Spain and operated under
shareholders, just before the investment deadline the Novotel and Ibis brands.
set in the members’ agreement ran out.
4. The acquisition by Blackstone from Banco
2. Total or partial completion of Build-Up projects Santander of 50% of all the real estate property
started in 2014, including: and loans Santander acquired from Banco Popular,
which included a significant portfolio of foreclosed
• The acquisition of 16.56% of Hispania by
hotels (REOs).
Blackstone. Through this acquisition Blackstone
adds to its earlier investment in HIPartners a
5. Lastly, the recent acquisition by Minor Hotel Group
stake in 46 new hotels and three plots of land for
of a 29.81% stake in NH, becoming the indirect
hotel developments.
owner of 11 NH hotels in Spain (1,790 rooms).
• The full acquisition by Atom, a Socimi (Spanish
REIT) led by Bankinter, of a portfolio of 15 hotels
and more than 3,700 rooms. This portfolio was
built up by the seller through hotel selective
purchases between 2014 and 2017.
Report on Hotel Investment in Spain
4 1H 2018
HOTEL PORTFOLIO DEALS 2018 H1
# Hotels in # Rooms weighted by
Spain % acquisition
Alua portfolio 7 1,708
Acquisition by Blackstone of 16.56% of Hispania 49 2,139
Atom Hotels (Bankinter Socimi) 15 3,779
Purchase of 57.8% of AccorInvest 11 903
50% Quasar Project 77 1,976
Acquisition by Minor of 29.81% of NH 11 534
H2 Hotels 2 187
B&B Hotels 2 191
Total portfolios 174 11,417
Source: Colliers International
“Investment in hotel
portfolios reaches
1,048 million euros”
“Blackstone is the
market’s most active
investor in the first half
of 2018”
Report on Hotel Investment in Spain
6 1H 2018
INVESTOR PROFILE Notably, Covivio, an eminently urban hotel investor,
recently approved a broadening of its investment
Turning to investors, the most important player by far strategy towards vacation products.
in recent months has been the U.S. private equity firm
Blackstone. Among the most noteworthy hotel chains in a buying
position are the Minor Hotel Group from Asia, which
In 2018, as a surprise follow-up to the acquisition has become a key shareholder of the NH Hotel Group
of HIPartners at year-end 2017—through which, in (aiming for full control); Hotusa, with the acquisition
addition to a large asset portfolio (14 hotels and 3,546 of 8 hotels and 729 rooms; B&B, which continues to
rooms), the firm also acquired a hotel investment and add hotels to its portfolio; and lastly, various other
management platform—Blackstone acquired George medium-sized hotel chains that have been very
Soros’ stake in Hispania, subsequently launching a full effective in scooping up smaller assets that are not
takeover bid for the Company. targeted by the large funds and investors.
Not only will the eventual outcome of this takeover bid Finally, there is the Bankinter-led initiative to set up
greatly affect the year-end investment figure, but a the Atom Socimi, creating an investment alternative
major bet on the Spanish hotel market by a fund such in the hotel sector for its private banking clients. It
as Blackstone at this point in the cycle will also help currently has a portfolio of 19 hotels comprising more
maintain investor appetite in our country. than 4,500 rooms and has a core profile.
Other international Socimis (REITs) such as Elaia and
Covivio (formerly Foncière des Murs) remain very
active in the Spanish hotel sector.
INVESTOR PROFILE (1H 2018-%)
International Real Estate
Investor
31%
1% Hotel chain
11%
National
10%
chain
13% 34% Socimi
National
Investor
Source: Colliers International / Global investment data
Report on Hotel Investment in Spain
1H 2018 7GEOGRAPHIC DISTRIBUTION OF INVESTMENT The reasons for this marked difference are:
Unlike the first half of 2017, when the investment • In the first half of 2017 both Madrid and Barcelona
was more or less evenly shared between the urban were the targets of a large number of investments
and vacation segments, in the first half of 2018 71% in high-value individual assets: Edificio España, sale
of the investment was intended for the acquisition of 50% of the Four Seasons Canalejas, the Hilton
of vacation hotels, mainly resulting from deals such Diagonal Mar in Barcelona, Silken Diagonal, etc.
as the acquisition of Alua by Hispania, Blackstone’s
• The political uncertainty in Catalonia in the wake
investment in Hispania and the bulk of the assets
of the 1st October 2017 referendum paralysed
acquired by the Atom Socimi.
Barcelona’s investment market.
The Canaries and the Balearic Islands attracted 53% • Madrid is still an object of desire for many
of the total investment, well ahead of the rest. It is investors, but the good market prospects have
noteworthy to mention the sharp fall in Madrid and put owners in a position where they can retain
particularly Barcelona. Whereas in the first half of ownership of the hotels, invest in their repositioning
2017 Madrid and Barcelona had 549 and 310 million and profit in the medium-term from the city’s
euros of investment, the respective figures for the continued draw as a destination.
same period of 2018 are 154 and 71 million.
MAIN INVESTMENT DESTINATIONS 1H 2018 (€M)
Other Madrid
154
437 Barcelona
71
239
269
230
Malaga 148 300
302 479
353
Canary Balearic
Islands Islands
460
Source: Colliers International / Global investment data
Report on Hotel Investment in Spain
8 1H 2018Also worth noting is the increase in investment in As we indicated in previous reports, this seems a clear “non-prime” destinations. In the first half, as can indicator that secondary markets, which are more be observed in the chart, 437 million euros (25% of dependent on domestic customers, are becoming the total) were invested in destinations other than more attractive as a result of the Spanish economy’s Madrid, Barcelona, the Islands or the Costa del Sol. good growth figures. This investment was shared among 36 provinces. This contrasts with the smaller volume recorded in the first half of 2017 (239 million euros), which was spread across 18 provinces. 2 Asumiendo toma de control del 100% de Hispania. Report on Hotel Investment in Spain 1H 2018 9
02 OUTLOOK
The Spanish market is now in its fourth consecutive together with the hotel chains, have given way to more
year of unprecedented investment volumes. conservative (Core) investors, who acquire the now
repositioned and stabilised product; yet there are still
The aggregate volume over the last three and a half opportunities to be found at all levels.
years already comes to 10,535 million euros, which
represents an average of 3,010 million euros per Nevertheless, the strong investor pressure and the
year. Added to that figure are the almost 1,000 million market’s good performance at the operational level
euros invested annually, on average, in Capex for have pushed up hotel purchase prices, and business
repositioning and hotel construction. plans are reducing their room for manoeuvre in
comparison to three years ago.
The reasons behind these extraordinary investment
volumes include, among other things, the market Moreover, the vacation market is starting to show
consensus regarding the good fundamentals for the first signs of a slowdown in growth. Against
tourism in Spain over the medium and longer term this background we anticipate a gradual easing of
and the fact that both institutional investors and investment levels over the next few years, although
specialised funds have discovered in vacation hotels the positioning achieved by Spain among the investor
an attractive investment product category to keep community will allow it to continue to be one of the
in their portfolios and on which they can deploy preferred investment alternatives in Europe in the
different investment strategies (core, value added and medium to long term.
opportunistic).
The strong inertia that has marked the start of the
The path has not been easy. After considerable effort, second half of the year, investment levels for 2018 as
the developments that have taken place in the market a whole could approach or even surpass those of 2017
since 2015, when the starting signal was given for if the various deals under way eventually go through.
the more opportunistic and value-added investors, are Minor’s bid for 100% of NH, coupled with a successful
gradually bringing about a transformation of mature bid by Blackstone for Hispania, could catapult the
destinations and breathing new life into obsolete investment volume to levels approaching 3,700 million
hotels that were eroding Spain’s ability to reposition euros2. Combined with the good number of sales of
itself commercially and be profitable as a destination. individual assets currently in progress, that could bring
investment close to the record levels seen in 2017.
The opportunistic and value-added investors, acting
as the principal initiators of the hotel repositioning
2 Assuming the acquisition of control of 100% of Hispania and NH.CONTACT
Miguel Vázquez
Managing Director | Hotels
miguel.vazquez@colliers.com
+34 91 579 84 00
Laura Hernando
Managing Director | Hotels
laura.hernando@colliers.com
+34 91 579 84 00
The content prepared by Irea Corporate Finance, S.L., an associate member of Colliers International Property Consultants (hereinafter, “Colliers International
Corporate Finance”), is protected by copyright, in accordance with the provisions of Legislative Royal Decree 1/1996 of 12 April, enacting the recast Intellectual
Property Law, which regularises, clarifies and harmonises currently applicable law on the subject. As provided in Articles 17 et seq. of the abovementioned law, any
reproduction, distribution, public communication or transformation of content prepared by Colliers International Corporate Finance is prohibited without the prior
written permission of Colliers International Corporate Finance, which has exclusive rights to use that contentYou can also read
