27 January 2018 – La Vanguardia
Banco Sabadell is continuing to divest its hotel business with the sale of five establishments in recent weeks for a total consideration of almost €20 million, according to market sources. The move comes after the entity sold its hotel management platform HI Partners to the US fund Blackstone for €630.7 million in October.
When it announced that sale, the entity reported that the transaction comprised 14 large and superior category hotels, including the ME Sitges Terramar, the Hilton Sa Torre in Mallorca and the Axel Hotel in Madrid. The bank reported that another 11 smaller hotels had been left out given that they did not fit the profile of the operation. But five of them have been sold by Sabadell in recent weeks, specifically: the Asta Regia Hotel in Jerez de la Frontera acquired by Hotusa; the Aparthotel Augusta in Boí Taüll acquired by Kesse Invest; the Bal Hotel Spa de Gijón purchased by Artiem; the Barceló Oviedo bought by Barceló; and the AC Lleida purchased by AA Hoteles.
Naturally, what Sabadell is selling is the ownership of the property. In most cases, these hotels were managed by other specialist companies. The hotels expanded Sabadell’s real estate portfolio during the economic crisis after their owners offered them to the entity as a way of paying the financial debt that they had contracted. They may also have resulted from foreclosures. The entity chaired by Josep Oliu and led by Jaime Guardiola (pictured above) worked with different scenarios to make its investments profitable, including debuting the company that was managing the hotels on the stock market. However, the appearance of Blackstone’s offer tipped the balance towards the sale. According to a statement filed with the CNMV, the bank obtained profits (extraordinary profits) of €55 million from the divestment.
The hotel manager does not form part of the bank’s business and a specific division had only been constructed to manage the foreclosed assets in the best way. The establishments that have now been sold are not beachfront or large properties, although some are located in purely tourist areas such as the case of the Aparthotel in Boi Taüll, which is situated in the closest urbanisation to the Llerida ski resort.
In the case of the sale of the 5 small hotels, the bank declined to disclose the amount of the sale although market sources indicate that the total transaction consideration amounts to around €20 million. Sabadell plans to continue with the divestment of the 6 remaining hotels over the next few weeks.
Original story: La Vanguardia
Translation: Carmel Drake
Source:: AURA Real Estate Experts