Redevco Enters Hotel Sector With €80m Foray Into Iberian Market
Main Photo: The Le 31 mixed-use development in Lille, with two hotels – Hyatt Centric and Stay KooooK by SV Hotel
Date: October 2022
Name: Redevco
Location: Spain & Portugal – Lisbon, Bilbao, Seville, Porto, and Malaga
Number of Keys: TBA
Seller: TBA
Buyer: Redevco, who manage 280 assets in 12 countries across various portfolios for multiple investor clients. These properties comprise 2.4 million sqm of space, represent more than 1,900 tenancies, and are worth €6.7 billion. They are part of COFRA, a diversified group of companies whose heritage dates back 180 years to the founding of C&A.
Redevco has ventured into the European hotel market with the acquisition of six real estate assets across Spain and Portugal for more than €80m (£70m).
The investments in Lisbon, Bilbao, Seville, Porto, and Malaga will seed the launch of Redevco’s ‘Next Gen Stays’ joint venture platform which will transform redundant properties into desirable hotels.
The intention is to build a €250m portfolio in the Iberian markets with a like-minded joint venture partner initially, before expanding into a pan-European hotel vehicle with a target €500m to €700m investment volume.
Next Gen Stays targets a net levered internal rate return of at least 15% over a five-year period.
The goal of the strategy is to capitalise on the post-pandemic resurgence and growth in the youth tourism and experience travel market and aggregate a professionally managed portfolio in a rapidly evolving and fast-expanding sector.
Redevco is working alongside a Spain-based boutique hotel operator that will drive the design and lease the asset.
Redevco said its new strategy ”is also targeting the strong sustainability and social returns that can be achieved through repurposing architecturally interesting but outdated buildings and upgrading their environmental footprints”.
Israel Casanova, managing director of global transaction management at Redevco, said: “By marrying Redevco’s strong retail and urban regeneration real estate investment track record with best-in-class hotel operators, our Next Gen Stays strategy plays to the latest upcoming travel and consumer trends.
”The vast online ‘sharing economy’ market that Airbnb identified and opened up is now professionalising in a more community-focused way. Our Next Gen Stays hotels form a distinct market sub-segment to target the younger, tech-savvy and sustainable travellers who are increasingly seeking out authentic, high quality yet affordable experiences.”
Herman Jan Faber, managing director of fund management at Redevco, added: ”We think that it is much more sustainable to convert existing buildings and make them as sustainable as possible, rather than knocking them down and building new – given the inherent embedded carbon.
Price: €80m
Price Per Key: TBA
THPT Comment: Interesting heritage for Redevco, over 200 years, including the Europe-famous C&A company…some hotel background in Le 31, Lille…. two hotels, lifestyle brand “Hyatt Centric” and the extended-stay brand “Stay KooooK” by SV Hotel, due to open in the refurbished C&A department store in Hamburg in 2025
First Seen: IPE Real Assets
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