RETAIL RESEARCH LUXURY HOTELS & RETAIL: The ideal commercial mix
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RETAIL RESEARCH HOTELS & RETAIL
LUXURY HOTELS
& RETAIL:
The ideal commercial mix
PARIS:
A reference point
in rental growth
CENTRAL MADRID´S
transformation
KNIGHTFRANK.ES | 1
RESEARCH HOTELS & RETAIL
HOTELS
& RETAIL
Pablo Párraga
Head of Retail
Pablo.Parraga@es.knightfrank.com
+34 600 919 078
Elaine Beachill
Introduction
Director of Retail Capital Markets
and Flagships
Elaine.Beachill@es.knightfrank.com
+34 600 919 016
Brynn Evans We are delighted to present this report, in which we share our analysis,
Senior Consultant Retail Capital Markets insight and opinions on the trends shaping Madrid´s retail landscape.
and Flagships
Brynn.Evans@es.knightfrank.com
+34 600 919 129 Drawing on the retail expertise of our Pan-European
network, we have specifically focussed on Madrid
Tamara Sánchez and Paris to explore the relationship between tourism
Senior Consultant Retail Capital Markets generated by luxury and 5-star hotels and the evolution
and Flagships of prime retail landscapes. The Madrid retail market
Tamara.Sanchez@es.knightfrank.com is constantly evolving and the current developments
in the city centre mean there are exciting times ahead
+34 600 919 073
for both retail operators and investors. Knight Frank
Jasper Henson remains at the forefront of Flagship retail. We hope
you find this report thought-provoking and enjoy
Consultant Retail Capital Markets
and Flagships reading it as much as we enjoyed compiling it.
Elaine Beachill
Jasper.Henson@es.knightfrank.com
Director of Retail
+34 600 919 108
Capital Markets
and Flagships
Rosa Uriol
Director of Research
Rosa.Uriol@es.knightfrank.com
+34 600 919 114
Laura García
Consultant of Research
Laura.Garcia@es.knightfrank.com The increase in quality and quantity of tourism
+34 600 919 113 over the next 18 months will directly and
positively impact Flagship retail in Madrid.
Cover:
Centro Canalejas Madrid, which will be home
to the Four Seasons hotel
2 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 3
RESEARCH HOTELS & RETAIL
Hotels
& retail
New luxury hotel openings and refurbishments drive
up the retail offering in the surrounding area, drawing in
high-end brands eager to tap into the increased number
of potential customers that fit their target public
4 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 5
RESEARCH HOTELS & RETAIL
THE GLOBAL IMPACT OF TOURISM TOP 10 COUNTRIES FOR LUXURY TOURISM
GDP AND EMPLOYMENT NO. OF LUXURY HOTELS
10.4
OF THE WORLD GDP
1. United States
2. Italy
1,203
237
3. United Kindom 189
1 IN EVERY 10 JOBS
AROUND THE WORLD IS 4. China 168
RELATED TO TOURISM
AND TRAVELLING 5. France 168
Source: World Travel & Tourism Council. Travel & Tourism 6. Mexico 161
Economic Impact 2018. World.
7. Thailand 135
8. Spain 124
H
otels and retailers have always gone Europe boasts a very 9. Canada 114
hand-in-hand, and with tourism pro- strong hotel supply.
viding retailers with one of the main
Four of the world’s 10. India 106
sources of customers, many opt to
top 10 countries with
open stores near to hotels.
the highest number of Source: Five Star Alliance
Five-star hotels act as a magnet for high-end brands luxury hotels are european.
looking for unique locations. While retailers help
bring a more stable and higher quality tourism to
the area, attracting more affluent tourists who not
only buy bigger ticket items and consume more
goods and services, but also have longer average
stays.
Europe boasts a very strong hotel supply. Four
of the world’s top 10 countries with the highest
number of luxury hotels are European, a rather re-
markable figure considering the other countries in
the ranking are much larger (with the exception of
Thailand).
European cities are established as go-to luxury
tourism destinations, with new and improved ho-
tels opening up in the most exclusive areas of cities
all across Europe. Longstanding hotels are no ex- AVERAGE STAY IN SPAIN’S HOTELS
In some European cities such as Paris, a wave of
BY CATEGORY
ception to this trend, with many closing for refur- high quality hotel openings have helped draw more AVERAGE NO. OF DAYS. 2018 JAN-SEP.
bishment. high-end retailers to the area, pushing up the rental
While another strategy that is proving popular prices of retail units on the streets neighbouring the 3.56 3.50 3.42
among hotel operators is to repurpose emblematic hotels. However, the closure of an emblematic ho-
properties into luxury hotels to ensure guests can tel has the revere effect on its neighbouring streets,
Above: 2.34
2.17
enjoy a truly memorable stay. Preserving a proper- causing retailer rotation to decline and rental in-
Centro Canalejas Madrid,
ty’s historical and unique features in order to make creases to slow. which will be home to the
them part of the guest experience adds extra value With this trend in mind, the current wave of luxury
Four Seasons hotel
to the overall service offered. hotel openings and refurbishments in Madrid is set Left:
to have very positive repercussions for the city cen- 5* 4* 3* 2* 1*
Hôtel Barrière Le Fouquet’s
tre’s retail units. Paris Source: INE. Hotel Occupancy Survey.
6 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 7
RESEARCH HOTELS & RETAIL
Partnerships between
hotels and major retailers
Retailers are no longer just interested in opening physical
stores, they are opening restaurants, teaming up with luxury
hotels and can now be found in any space that offers its
customers a unique experience
T
TOP HOTELS
he most prestigious hotels in the
FASHION BRANDS
world are improving their design and
retail services in a bid to win over their
guests who are becoming increasingly
demanding and expecting ever-higher stand-
BVLGARI MILAN, LONDON, BALI,
ards. As such, they are focusing on offering new BEIJING, DUBAI, SHANGHAI
experiences that appeal to all the senses as part
of a wholly unique service.
488 UPCOMING OPENINGS:
ROOMS MOSCOW, PARIS, TOKYO
Today’s guests are not just looking for quality
accommodation in which they can stay, they are
also looking for a hotel that goes the extra mile VERSACE
to offer them just that bit more to ensure their GOLD COAST
stay is a truly memorable experience. Design, ar- 415 (AUSTRALIA), DUBAI
chitecture and decor are key, not only to provide ROOMS
a good hotel service, but also to create that all-
important experience to remember.
GIORGIO ARMANI
In order to create unique and luxurious spaces,
some major hotel chains have joined forces with 255 MILAN, DUBAI
the world’s most influential contemporary de-
ROOMS
signers who are leaving their mark on emblem-
atic hotels all over the world. Some designers
such as Óscar de la Renta, Diane von Fursten-
CAMPER
berg, Salvatore Ferragamo, Christian Lacroix,
Ralph Lauren and Bottega Veneta have teamed 76 BARCELONA, BERLIN
up with different operators to design and deco- ROOMS
rate some of their most iconic hotels. The con-
tributions of these designers are a major draw
for the loyal followers of these brands. MOSCHINO
For 34 years Coco Chanel lived in the suite at
Paris’ Ritz Hotel, the suite which now bears her
65 MILAN
ROOMS
name and retains her unmistakable essence.
Over the years she gradually adapted its décor
and style to her tastes, and today the luxury of
staying in the suite is reserved for the wealthiest Right:
of guests (with prices starting from €25,000 per Karl Lagerfeld. Hotel Crillon
night). Paris
8 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 9
RESEARCH HOTELS & RETAIL
Retailers have identified the potential of the
hotel sector as a means of diversification.
Trusting in a blend of creativity, style, comfort
and good taste, they have forged partnerships
with major hotel chains. For instance, in 2016
Tommy Hilfiger acquired the Raleigh hotel in
Miami to convert it into a luxury hotel-bou-
tique where, by paying an annual fee, mem-
bers can gain priority for reservations and use
the hotel’s services.
Other brands have gone one step further,
extending their own brand throughout the
hotel market. Bvlgari has been a trailblazer in
this regard, after opening its first hotel in Mi-
lan in 2004, it created its own brand, Bvlgari
Hotels & Resorts, which can now be found in
London, Bali, Beijing, Dubai and Shanghai,
with openings planned for Moscow and Paris
in 2020 and Tokyo in 2022.
The Palazzo Versace Gold Coast, located on
Australia’s Gold Coast, was designed by Gi-
anni Versace to express the luxury, glamour,
sophistication and class offered by this fash-
ion brand in the form of a six-star hotel.
LVMH group expands with Cheval Blanc ho- Above:
Coco Chanel
tels opening in Courchevel, Saint-Barthélé-
Suite Hotel Ritz
my and the Maldives, in addition to those Paris
planned for 2020 in Paris and Bali.
Right:
Armani’s two hotels invite guests to “Stay Diane von Furtensberg
with Armani”. The first, located in the iconic Hotel Claridge’s
London
Burj Khalifa building, the tallest tower in the
world, is directly connected to the largest
shopping centre in the world, the Dubai Mall.
While the second, in Milan, the heart of the
The so-called kaiser of fashion, Karl Lagerfeld,
Italian fashion world, features a boutique in
who has decorated a number of hotel rooms
each room offering guests the chance to pur-
to date, is set to expand his personal brand by
chase a range of designs from the brand.
opening his own chain of hotels, restaurants
Another hotel in Milan is the Maison Moschi- and nightclubs. While, the head creative direc-
no. Its rooms are lavishly decorated with 16 tor of Chanel and Fendi is set to open his six-
different styles, ranging from forest settings, star hotel under the Brandmark Collective BV
lamps shaped like dresses and a plethora of brand in Macau in 2019.
the highest quality fabrics on display in the
In Spain, Casa Camper, the hotel chain run
reception area. The hotel is the perfect show-
by the Spanish footwear specialists, boasts a
case for high-end goods, with all items avail-
total of two hotels, one in Barcelona and one
able for purchase.
in Berlin.
In Madrid, a standout example is the five-star
Puerta de América hotel, located at Avenida
de América 41. A true icon of cutting-edge de-
Above: sign in Spain and around the world, each of its
Christian Lacroix
12 floors was created by a renowned architect
Hotel Le Petit Moulin
Paris or designer, including France’s Jean Nouvel,
Retailers have identified Japan’s Arata Isozaki, the UK’s Norman Fos-
the potential of the hotel Right:
ter and David Chipperfield, Iraq’s Zaha Hadid
Christian Dior
sector as a means of and Spain’s Javier Mariscal and Victorio &
Suite del Hotel St. Regis
diversification. New York Lucchino.
10 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 11
RESEARCH HOTELS & RETAIL
T
he Parisian hotel sector is clearly investing
in the luxury segment. One of the reasons
for this is that operators are looking to capi-
talise on Paris’ growth potential, which has The number of luxury
been boosted by the need to refurbish several hotels hotel rooms has
in order to bring their offering into line with what is significantly spiked
expected by increasingly demanding overseas visi- in recent years.
tors. Other factors include competition from other
European destinations and the rise of new types of
accommodation, such as Airbnb, which is prompt-
ing hotels to seek new strategies to stand out from the
crowd.
Additionally, in July 2009 France’s hotel rating sys-
tem was updated, incorporating the Palace category
for exceptional five-star establishments that help to
promote French culture and enhance the appeal of
France as a destination. The ambition to achieve this
classification has prompted many
well-established hotels to invest in
significant refurbishments and reno-
vations.
Past & present
The number of luxury hotel rooms
has significantly spiked in recent
years. This rise is down to newcomers
trends:
– the Shangri-La in 2010, the Manda-
rin Oriental in 2011 and The Penin-
sula in 2014 – and the refurbishment
Paris
and extension of other existing hotels
such as the Ritz, the Crillon, Barrière
Le Fouquet’s, the Bristol, the Prince
de Galles and the Plaza Athénée.
Many retailers have been drawn in by the openings
Although it is difficult to pinpoint
of impressive luxury hotels, seeking new pitches on
a clear cause-effect relationship be-
neighbouring streets where they can showcase their
tween luxury hotel openings and
retail unit rental increases, this phe-
brands
nomenon has been observed in sev-
eral areas of Paris. For example, fol-
lowing the opening of the Mandarin
Oriental on Rue Saint-Honoré, rents climbed 16%
above the prime rent between 2011 and 2014. Two
years after the Plaza Athénée opened in 2014, rents
on Avenue Montaigne grew to top the prime rent by
21%. In contrast, during the same period, rents on
Boulevard Raspail fell to 15% below the prime rent af-
ter the Hotel Lutetia closed for refurbishment works.
However, it must be mentioned that the popularity of
the Boulevard Raspail area has dwindled in recent
years in general.
Left:
Hotel Mandarin Oriental
Paris
12 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 13
RESEARCH HOTELS & RETAIL
M
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Fuente: Knight Frank
REFORMAS NUEVOS DESARROLLOS
1. Lutetia 6. Plaza Athénée 9. Hôtel Fauchon L’Hôtel 14. Mandarin Oriental 19. So Sofitel
45 Boulevard Raspail 25 Avenue Montaigne 11 Place de la Madeleine 251 Rue Saint Honoré Champs-Elysées
Opened 2018 Opened 2014 Opened 2018 Opened 2011 Opened 2022
231 rooms 208 rooms 54 rooms 178 rooms 100 rooms
7. Prince de Galles 10. Nolinski Paris 15. Shangri-La
2. Hôtel Crillon
33 Avenue George V 16 Avenue de l’Opéra 10 Avenue D’Iéna
10 Place de la Concorde
Opened 2013 Opened 2016 Opened 2010
Opened 2017
159 rooms 45 rooms 81 rooms
124 rooms
8. Hôtel George V 11. Le Roch Hôtel & Spa 16. Hôtel Bulgari
3. Barrière le Fouquet’s
31 Avenue George V 28 Rue Saint-Roch 30 Avenue George V
46 Avenue George V
Opened 2013 Opened 2016 Opened 2020
Opened 2017
244 rooms 37 rooms 76 rooms
81 rooms
9. Hôtel Costes 12. La Réserve Hôtel and Spa 17. Hôtel Cheval Blanc
4. Ritz Paris
Rue Saint-Honoré 42 Avenue Gabriel Rue de Rivoli
15 Place Vendôme
Opened 2019 Opened 2015 Opened 2020
Opened 2017
82 rooms 40 rooms 50 rooms
159 rooms
13. The Peninsula Paris 18. Kimpton
5. Hôtel Le Bristol
19 Avenue Kléber Boulevard des Capucines
112 Rue du Faubourg Saint-Honoré
Opened 2014 Opened 2020
Opened 2016
234 rooms 149 rooms
190 rooms
Avenida de los Campos Eliseos. Paris
14 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 15
RESEARCH HOTELS
HOTELS
& RETAIL
& RETAIL
VARIATION IN HIGH STREET RENTS IN PARIS
THE IMPACT OF LUXURY HOTEL OPENINGS
MANDARIN ORIENTAL.
251 RUE SAINT HONORÉ
RUE SAINT- HONORÉ
The Hotel Mandarin Oriental, built
in 2011, has clearly been one of the YEAR MAJOR OPENINGS
14,000 RUE SAINT HONORÉ
driving forces behind the luxury
RENTAL FORECAST WITHOUT HOTEL MANDARIN ORIENTAL 2012: Dsquared2, Chloé, Moynat, Balenciaga,
trend on Rue Saint-Honoré cur- Tom Ford, Ports 1961
12,000 PRIME RENTAL AVERAGE
rently one of the most vibrant streets
2013: Valentino, Viktor & Rolf, Dior Parfums,
in Paris. Between 2012 and 2017, this 10,000 Tom Ford
avenue accounted for 18% of luxury Hotel 2014: Gianfranco Lotti, Exemplaire, Lyubov
openings in Paris, and a further third 8,000 opening
2015: Mulberry (relocation), Missoni
of all openings in 2018-2019, com-
(relocation), Tory Burch, La Prairie,
6,000
fortably ahead of Avenue Montaigne Alexander McQueen
(12%) and Rue Faubourg Saint-Hon- 2016: Fendi, Brioni, Furla (relocation), Marc
4,000
oré (12%). Jacobs (relocation), Paul Smith
(relocation)
2,000 + 16 PERCENTAGE POINTS
above prime rental growth between 2011 and 2014 2017: Dior (pop-up), Stella McCartney,
0 Christofle, David Morris, Guerlain
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (relocation)
2018: Chanel, Pucci (pop-up), Moschino
(relocation), Bilionaire, Pomellato
(relocation)
AVENUE MONTAIGNE
16,000 AVENUE MONTAIGNE PRIME RENTS YEAR MAJOR OPENINGS
RENTAL FORECAST WITHOUT PLAZA ATHÉNÉE 2012: Chanel, Escada (relocation), Revillon
LUTETIA. 14,000
PRIME RENTAL AVERAGE (relocation), Fendi (relocation)
45 BOULEVARD RASPAIL Hotel
12,000 opening 2013: Armani, Saint Laurent, Givenchy,
Hôtel Lutetia closed for refurbish- Pucci (relocation)
10,000
ment works in 2014, a time when the 2014: Yves Salomon, Céline (relocation)
number of high-end retail openings 8,000 2015: Extensions or reforms as Jimmy
in the area had begun to slow follow- Choo or Ricci
6,000
ing an exceptionally active period.
2016: Dior Joaillerie, Loro Piana (relocation),
Between 2010 and 2014, openings in- 4,000 Chloé (relocation)
cluded Hermès and Ralph Lauren in
+ 21 PERCENTAGE POINTS 2017: Balenciaga, Shiatzy Chen
2010, Céline in 2011, Louis Vuitton in 2,000
above prime rental growth between 2014 and 2016 2018: Miu Miu, Roberto Cavalli (pop-up)
2012 and Berluti in 2013, to name but 0
PLAZA ATHÉNÉE. 25
a few. Tenant rotation ground to a halt 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
AVENUE MONTAIGNE
after the hotel closed.
Reopened in 2014 as a Palace
category establishment, this RUE DE SÊVRES
hotel has been one of the true
gems of the international hotel
scene since it very first opened 12,000 RUE DE SÈVRES YEAR MAJOR OPENINGS
in 1913, boasting unique Art RENTAL FORECAST WITHOUT HOTEL LUTETIA CLOSURE 2012: Paul Smith y Céline opened
Deco-inspired features and 10,000 PRIME RENTAL AVERAGE in calle de Grenelle (close to
calle Sèvres), Louis Vuitton
surrounded by haute-couture
(ampliación)
boutiques. Many brands have 8,000
opted for exclusive pitches on 2013: Shang Xia, Omega, Berluti
Avenue Montaigne, in Paris’s 6,000 2014: Moncler y Salvatore Ferragamo
prestigious Golden Triangle, opened in close streets
Hotel
where a range of new retail- closure 2015: No Openings
4,000
ers have opened alongside 2016: Dsquared2 in calle de Grenelle
existing retailers, who have 2,1000
- 15 PERCENTAGE POINTS 2017: No Openings
strengthened their networks
above prime rental growth between 2014 and 2016 2018: No Openings
with flagships offering the lat- 0
est products on the market. 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
16 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 17
RESEARCH HOTELS & RETAIL
What´s
happening
in Madrid
Madrid is at an unprecedented juncture, the
positive forecasts for the future of the city have
attracted investors and sparked a wave of hotel
refurbishment projects
Right:
Centro Canalejas Madrid, which will be home
to the Four Seasons hotel
Tourism in Madrid
M
adrid’s wealth of historical and cul-
tural heritage, extensive gardens,
gastronomical delights, world-re-
nowned fashion scene and vibrant
leisure offering, make it one the top go-to tourist
destinations in both Spain and Europe, convert-
ing the tourism sector into one of the key drivers
of the city’s economy.
Madrid ranks second in the Relative Tourism
Competitiveness Monitor for Spanish Cities, as
measured by Exceltur, and is also second in terms
of tourist intake in Spain, behind first-placed Bar-
celona. It is therefore one of Spain’s strongest cit-
ies in this sector, and each year is attracting a rap-
idly growing number of overseas visitors.
18 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 19RESEARCH HOTELS & RETAIL
TOTAL TOURIST SPEND IN MADRID DEMANDA HOTELERA EN LA CIUDAD DE MADRID POR MESES
OVERSEAS TOURISTS
NO. OF VISITORS
T1 T2 T3 T4
2016 2017 2018 Source: Ayuntamiento de Madrid
10,000
900,000
9,000
850,000
8,000
800,000
7,000
750,000
6,000
700,000
5,000
650,000
4,000
600,000
3,000
2,000 550,000
1,000 500,000
JAN FEB MAR APR MAY JUN JUL AGO SEP OCT NOV DIC
0
2015 2016 2017 2018
Source: IET | INE | Knight Frank Research When visiting Madrid, many tourists opt to stay one in the Salamanca district and the other in the Re-
in one of the more than 200 hotels in the city. The tiro district. The opening of the Four Seasons hotel
According to official sources, 2017 was a record- majority of overseas tourists that choose this type of in the Centro Canalejas will be the very first Grand
breaking year, with more than 9 million tourists accommodation are European (28%), followed by Luxe hotel to be located in the Central district.
visiting the city. During the first seven months of Latin Americans (12%) and Americans (7%).
A trend of high quality tourism is also gaining trac-
2018, this figure rose once again – up 2.6% y-o-y The most common type of hotel within Madrid’s ex- tion, attracting tourists who have longer average
– meaning this year looks set to enter the record tensive supply is the four-star category, with 5-star, stays and higher average spends. The combination
books once again. 5-star Luxury and 5-star Grand Luxe categories far of all these factors is prompting some of the world’s
Overseas tourists are spending more and more more exclusive, and accounting for a total of around leading hotel groups, such as Four Seasons, Marriott
money in Madrid each year. In the first three 11%. The Central district is home to the lion’s share and Hyatt, to home in on Spain as a location for ex-
quarters of 2018, the average overseas tourist of tourist accommodation, accounting for almost pansion.
spend was up 2.3% y-o-y, making Madrid the half of the hotels in Madrid. However, the city cen-
region with the greatest average daily spend in tre hasn’t traditionally been home to Grand Luxe
Above:
Spain – at €240 – ahead of Catalonia’s €200 hotels, with just two hotels falling into this category,
VP España Design
and the national average of €145. Madrid.
HOTELS BY CATEGORY HOTEL SUPPLY IN MADRID BY DISTRICT* HOTEL SUPPLY IN MADRID BY HOTEL TYPE
CENTRAL DISTRICT % OF EACH HOTEL TYPE BY DISTRICT NO. OF ROOMS AND NO. OF HOTELS AS A % IN MADRID
OVERNIGHT HOTEL STAYS IN MADRID
NATIONAL AND OVERSEAS TOURISTS 5*GL 5*L 5* 4* 3* 2* 1* 312
1,573 691 366
100 4,214
5% 5*GL
Overseas tourists 8% 9%
5,622 1 % 1%
National tourists 5*L
12
Millions
5*
10 % hotels
23% 4*
50
8
3*
6
2*
4 53%
1*
24,875
2 0
45% 31% 11% 10% 3% 1% CENTRO ARGANZU. RETIRO SALAMANCA CHAMARTÍN TETUÁN CHAMBERÍ FUENCARRAL MONCLOA
0
1999 01 03 05 09 07 09 11 13 15 2017 4* 3* 2* 5* 1* 5*L (114) (8) (10) (33) (12) (15) (20) EL PARDO (9) ARAVACA (12) NO. rooms
Source: Ayuntamiento de Madrid Source: Ayuntamiento de Madrid
Source: Ayuntamiento de Madrid *Entre paréntesis el número total de hoteles en cada distrito Source: Ayuntamiento de Madrid
20 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 21RESEARCH HOTELS & RETAIL
Hotel openings
in Madrid 1. Gran Hotel Inglés 5* 4. Plaza de las Descalzas 5* 7. Pestana Plaza Mayor 4* 10. Four Seasons Canalejas 5*GL
Echegaray 8
city centre Opened april 2018
Plaza de las Descalzas 3
Opened end of 2019
Plaza Mayor 28-29
Opened april 2019
Centro Canalejas
Opened january 2019
48 rooms 180 rooms 87 rooms 200 rooms
2. Hyatt Centric 5* 5. Marriott W 5* 8. Hotel Pestana CR7 4* 11. Teatro Albéniz 5*
Gran Vía 31 Carrera de San Jerónimo 9-11 Gran Vía 29 Paz 11
Opened december 2017 Opened june 2019 Opened january 2020 Opened june 2019
175 rooms 141 rooms 160 rooms N/A
12
3. Aloft Gran Vía 4* 6. VP España Design 5* 9. Barceló Torre de Madrid 5* 12. Riu Edificio Plaza España 4*
Jacometrezo 4-6-8 Plaza de España 5 Plaza España 18 Gran Vía 84
Opened february/march 2019 Opened may 2018 Opened january 2017 Opened july 2019
LARGE HOTEL 139 rooms 214 rooms 256 rooms 589 rooms
PROJECTS TO BE
COMPLETED IN
MADRID BY 2020
+1,200 9
12
NEW RECENT REFURBISHMENT PROJECTS
PLAZA DE
ROOMS IN ESPAÑA UPCOMING REFURBISHMENT PROJECTS
5* HOTELS RECENT NEW-BUILD PROJECTS
6 UPCOMING NEW-BUILD PROJECTS
C
PRIME HIGH STREETS
A
L
L
E
G
R
A
N
V
ÍA
Nike Primark Michael Kors
3 Zara Mango
Right and down: GRAN VÍA Aristocrazy
PLAZA
Hotel Hyatt Centric H&M
DE 2 8
Madrid Adidas GR
CALLAO AN
New Balance VÍA
A
ER
NT
MO
PLAZA DE Zara
4 LAS
A
DESCALZAS
E L
Mango
E D
Pepe Jeans
El Corte Inglés LÁ
LL
CA
AL
CA
L LE 10
Desigual Aristocrazy CA
Apple
Pronovias PUERTA DEL SOL
5
YOR Zara
MA
LE
CAL 7 1
11
22 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 23RESEARCH HOTELS & RETAIL
UPCOMING OPENINGS
The most exclusive Four Seasons Hotel Madrid in the Canale- obliged to preserve the hall, stage, entrances
new hotels in the jas Centre Madrid project. to all three levels of the theatre and its stair-
cases, which will remain a fundamental part
centre of Madrid The Canalejas Centre Madrid will be home
of the property’s interior.
to the first hotel of the prestigious Four Sea-
sons brand in Spain and one of their most
Hotel Marriot
exclusive in Europe. 200 rooms in the very
RECENT OPENINGS heart of Madrid which, together with a pre- Opposite the Centro Canalejas, the for-
mium 5* service, are ready to captivate high- mer Hotel Asturias will be brought back to
level international tourism. life by the hotel chain W, part of the Mar-
Gran Hotel Inglés
riott Starwood group. Guests will be able
The project is the most important in the
The city centre’s very first luxury hotel to enjoy the philosophy of W’s Whatever/
capital and will regenerate the central area
– located in the heart of the Letras neigh- Whenever service, as well as the exclusive
at the junction of the Calle Alcalá, Sevilla,
bourhood – recently reopened thanks to Madrid W Happenings, offering both
Carrera de San Jerónimo y plaza de Canale-
the Hiffen Away Hotels group, specialists guests and residents the very latest in fash-
jas. With the opening expected to be at the
in restoring historic hotels to their origi- ion, design and music.
end of 2019, the lower floors will house a 45
nal splendour. The restoration project
boutique shopping gallery and the upper
was inspired by the 1920s, preserving the Plaza de las Descalzas
floors, 22 luxury apartments with 5* service
original columns and lamps and reducing The building, acquired KKH Property In-
from the Four Seasons hotel and the best
the number of rooms in the hotel in order vestors from the Fundación Montemadrid
views of the city.
to create more spacious rooms – with the in 2016 to convert it into a luxury hotel,
smallest room now comprising 27 sqm. is located opposite the Descalzas Reales
Teatro Albéniz
monastery, formerly the Monte de Piedad
Hyatt Centric After remaining closed for a decade, the
headquarters. It features a façade that dates
former Albéniz theatre will be Iberostar’s
This hotel, located on Gran Vía, opened to 1733 and is listed as being of Cultural In-
second hotel in Madrid. Madrid’s regional
as Spain’s first Hyatt Centric in a former terest. The detailed sectoral plan (plan es-
government listed the theatre as a Property
office building. It features a restaurant on pecial) to build a luxury hotel in this period
of Heritage Interest, authorising any use for
the first floor “Hielo y Carbón” (Ice and property has already been approved by the
the property, as long as it was compatible
Charcoal), which combines Peruvian and City Council.
with the nature of the space. The owners are
Spanish cuisine in an open-plan space
that boasts fabulous views out onto Gran
Vía. Its top floor houses its recently un-
veiled rooftop terrace “El jardín de Diana”
(Diana’s garden), which takes its name
from a five-metre statue designed specifi-
cally for this hotel.
Gran Hotel
Inglés 5* VP España Pestana Plaza Teatro Albéniz Riu Edificio Four Seasons Hotel Pestana
Hyatt Centric 5* Calle Design 5* Mayor 4* 5* Calle de la Plaza España 4* Canalejas 5*GL CR7 4*
Calle Gran Vía 31 Echegaray 8 Plaza de España 5 Plaza Mayor 28-29 Paz 11 Gran Vía 84 Centro Canalejas Gran Vía 29
2017 2019 Above:
Gran Hotel
Inglés
2018 2020 Madrid
Aloft Gran Vía 4* Marriott W 5* Plaza de las Right:
Barceló Torre Heritage Madrid Ritz Mandarin
de Madrid 5* Hotel 5* Calle Jacometrezo Carrera de San Descalzas 5*
Oriental 5*GL
Hotel Hyatt
4-6-8 Jerónimo 9-11 Plaza de las Centric
Plaza España 18 Calle Diego de León 43 Plaza de la
Descalzas 3
Lealtad 5 Madrid
24 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 25RESEARCH HOTELS & RETAIL
is taken as a case in point, where the open-
ing of five-star hotels has sparked rental in-
creases in the retail units located on streets
in their vicinity, the wide range of luxury HIGH STREET RENTS IN MADRID
hotels due to open in Madrid are set to drive €/SQM/YEAR
prime high street rents upwards in a similar
fashion.
With 12 new hotels set to open in the centre GRAN VÍA
of Madrid by 2020, the number of 5-star ho-
tel rooms will increase by 1,200, almost dou- 3,500 GRAN VÍA
bling current supply and with an unprece-
AVERAGE PRIME
dented density of luxury hotels in this zone. 3,000
This is expected to drive up both the quality
2,500
and quantity of tourism in the city, drawing
luxury and high-end buyers into these areas. 2,000
Using Paris once more as an example, where
1,500
after many luxury hotel refurbishments high
street rental prices have risen by between 15 1,000
and 20 percentage points above the average
prime rents, high street rents in the centre 500
of Madrid can be expected to follow a simi-
0
lar pattern. We therefore expect the most 2005 06 07 08 09 10 11 12 13 14 15 16 17 2018
prime units in the most privileged locations
to benefit most from these new hotel pro-
jects.
PRECIADOS
4,000
PRECIADOS
3,500
AVERAGE PRIME
3,000
2,500
Left: 2,000
Puerta del Sol
Madrid 1,500
1,000
500
Variation in high 0
2005 06 07 08 09 10 11 12 13 14 15 16 17 2018
street rents The large
number of luxury
accommodations
T
FUENCARRAL
he best retail units on Calle Preciados that are to be
have traditionally had the highest rents inaugurated in the
3,500 FUENCARRAL
in Madrid, but in recent years they have Spanish capital,
AVERAGE PRIME
been overtaken by Gran Vía, Puerta del with enhance prime 3,000
Sol and Calle Fuencarral, given the rising number high street rents in
of retailers looking for space in the city centre. a manner similar to
2,500
There are currently several retail projects under that seen in Paris. 2,000
development in the heart of the city. With many
1,500
of these located on Gran Vía, they are set to raise
the profile of the street’s retail offering, and put 1,000
the high street on the radar of a number of inter-
national retailer. Growing attention from inter- 500
national brands will push rents up even higher
Right: 0
on these streets, however, this won’t be the only 2005 06 07 08 09 10 11 12 13 14 15 16 17 2018
Calle Gran Vía
factor driving transformation in this area. If Paris Madrid
26 | KNIGHTFRANK.ES KNIGHTFRANK.ES | 27RESEARCH knightfrank.com 28 | KNIGHTFRANK.ES
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