Abu Dhabi Investment Authority (ADIA) has acquired a landmark 17-hotel portfolio through its subsidiary, Coral Reef, from Equity Immuebles in Spain.
The deal will help the Middle Eastern sovereign wealth fund significantly increase its presence in Spain as it continues to grow its international real estate portfolio.
While financial terms of the transaction were not disclosed officially, a report in CincoDĂas said the deal closed at around €600 million ($647.5 million), which was less than the €700 million ($755.42 million) initially agreed upon by the buyer and seller.
This is the largest hotel portfolio to be transacted in Spain, according to JLL, which advised Equity Immuebles on the sale. Equity Immuebles is mostly owned by the Calero, Briones and Mazin families.
The deal was green-lighted by the European Commission under the EU merger regulations.
The portfolio includes full-service hotels in popular tourist destinations across Spain, with most hotels located in Madrid and accounting for 37% of the room count. The hotels have “exceptional real estate quality and diversity of locations, catering to various segments, including winter and summer leisure destinations, as well as corporate and MICE business,” JLL said in a statement.
One of the most notable properties in the 17-asset portfolio is the 192-room ME Madrid Reina Victoria by Melia in Madrid’s Plaza de Santa Ana. The avant-garde design hotel is located in a 19th-century palace and features a modernist façade while offering panoramic views of the city from its rooftop bar.
The portfolio comprises five more Melia-branded hotels in five other cities, eight Tryp-branded hotels and three Sol-branded properties. All 17 hotels will reportedly be managed by Mallorca-based Melia Hotels.
“This historic transaction signifies a major milestone in the real estate market. The strong interest from global investors, particularly from the Middle East, who accounted for nearly 50% of transaction volume in Spain as of August 2023, underlines the resilient and appealing nature of the hospitality sector. It continues to be a prime focus for investors seeking dynamic opportunities within the real estate asset class,” said Patrick Saade, senior managing director of EMEA Hotels & Hospitality Capital Markets at JLL.