Main Photo: The Bless Hotel Ibiza
Date: July 2020
Location: Madrid-based, Spain
Name: The Azora European Hotel & Lodging Fund
No. of Keys: TBA
Who: Madrid-based European real estate investment fund manager Azora has raised €680m to launch a new fund, Azora European Hotel & Lodging, F.C.R., above the fund’s initial target of €600m.
With a €750m cap, the fund has an implied total capacity of more than €1.5bn to invest in leisure hotels in Europe, with a significant portion of the portfolio to be located in Spain.
Azora EH&L has received the support of a group of global investors, non-European sovereign wealth funds and a major global institutional investor. Investors will also have the opportunity to provide co-investment capital in addition to their commitments, further increasing the fund’s investment capacity.
The fund will focus on the “sun and beach” segment in major European tourist destinations, where it will implement a strategy of added value through repositioning, renovation and active asset management. In addition, the Fund will target urban tourism through new “smart urban accommodation” concepts, which focus on the needs of travellers and offer accommodation and “flexible offers” that can be tailored to demand.
Azora has already secured a portfolio of ten hotels comprising 2,800 keys and located in seaside resorts on the Spanish mainland coast (seven), Ibiza (two) and Sicily (one), which are managed by Spanish hotel operators MedPlaya and Palladium, as well as four city centre assets in Madrid, Lisbon, Brussels and Bilbao, which will be re-positioned as urban accommodation concepts, offering a total of 1,200 beds.
“In these extraordinary times, the level of commitments we have achieved so far for the Azora European Hotel & Lodging Fund underlines the confidence of the international investment community in our ability as manager to create value and in the continued potential of the European hotel industry as an institutional asset class, regardless of the short-term impact of the Covid crisis, which we also believe will lead to additional opportunities beyond those envisaged in our initial business plan,” says Concha Osácar, founding partner of Azora.
Founded in 2003, Grupo Azora is a leading, vertically integrated, Spanish real estate investment and asset management firm, with c.€4 billion of equity capital committed since its foundation. Over the past 17 years, Azora has grown to over 250 professionals with extensive experience across the spectrum of real estate investing.
Azora specialises in different types of assets: residential, hotels, logistics, offices, senior homes and renewable energy and is promoting new investment lines in logistics and leisure. Azora is currently the largest manager of purpose-built rented residential in Spain, with more than 14,000 homes under management.
Azora was the first institutional real estate investor and asset management firm to enter the sun & beach hotel segment, building the largest hotel platform in Spain, Hispania (46 hotels, over 13,000 keys and c. €2.0 billion of gross asset value), which was successfully sold to Blackstone in July 2018, generating net returns of 19% IRR, in a listed format.
THPT Comment: Delighted to see this fund available to stimulate the Spanish/European hotel market.
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