Two-year-old Spanish REIT Merlin has sold a portfolio of hotels located primarily in Barcelona and Madrid to a subsidiary of Paris' Foncière des Murs. According to the French company, the deal represented an investment of €542 million.
Foncière des Murs sought the portfolio to gain a foothold in the "fast-growing" Spanish market, which the company said in a statement is the third most popular tourist destination worldwide. "The strong growth of the tourist and business clientele, particularly in Barcelona, which is now continental Europe's foremost destination for business seminars, makes it possible to envisage a further increase in RevPAR of 8 percent in 2017," the company claimed.
The portfolio acquired by Foncière des Régions consists largely of centrally located midscale and upscale hotels, including the Barcelo Torre de Madrid, the NH Collection Colon in Madrid, the Eurostars Gran Marina and the AC Forum in Barcelona.
The hotels are leased under fixed- or guaranteed-rental leases to major names in the Spanish hotel industry such as Melia, Hotusa, Barcelo and NH. In total, the portfolio represents 3,800 guestrooms.
As part of this transaction, Foncière des Murs, a branch of Foncière des Régions, is planning a capital increase of around €200 million over the first half year with preferential right of subscription being maintained. The acquisition is being financed in cash and by a new debt over eight years at a cost of around 1.85 percent.