Starwood Capital Group and Melia Hotels International on Friday announced that they have established an 80-20 joint venture, respectively, to acquire a collection of hotels across key resort locations in Spain.
The initial €176 million (US$198 million) transaction consists of seven beachfront hotels representing 2,933 keys that are currently owned by Melia and will continue to be managed by the group.
Included in the initial portfolio are the Sol Principe in Malaga, the Sol Lanzarote and Melia Gorriones (Fuerteventura) in the Canary Islands, the Sol Ibiza and Sol Pinet Playa in Ibiza, and the Sol Mirlos and Sol Tordos (Palmanova, Mallorca). The hotels will all be fully refurbished, after which the Sol Principe, Sol Lanzarote, Sol Mirlos and Sol Tordos will continue to operate under the new Sol Hotels brand. The Sol Mirlos and Sol Tordos will be renamed as the Sol Palmanova. Sol Ibiza will become Sol Beach House Ibiza and Sol Pinet Playa will be renamed Sol House Pinet Ibiza. The main portion of the Melia Gorriones property will continue to operate under the Melia brand, and the current annex will be rebranded as Sol Beach House Fuerteventura.
“With their irreplaceable locations, strong cash flow-producing businesses and consistent operating track records, these properties present an attractive portfolio with significant potential still to be realized,” said Keith Evans, vice president, European Hotels at Starwood Capital Group. “We look forward to investing in these properties and leveraging Starwood Capital Group’s hospitality expertise to help drive growth in the future.”
The joint venture represents Starwood Capital Group’s second transaction in Spain over the last several months. In late October, the firm completed the acquisition, through a controlled affiliate, of a portfolio of loans from BFA-Bankia Group that included a significant number of real estate properties as underlying collateral.
Starwood Capital Group has acquired more than US$63 billion of real estate assets globally since its inception in 1991, including approximately 2,300 hotels and resorts.