The Abu Dhabi Investment Authority (ADIA) has acquired a historic portfolio of 17 hotels through its subsidiary Coral Reef from Equity Immuebles in Spain.
The deal will help the Middle Eastern sovereign wealth fund to significantly increase its presence in Spain while continuing to grow its international real estate portfolio.
While the financial terms of the transaction were not officially disclosed, a report in CincoDías It said the deal closed at around 600 million euros ($647.5 million), less than the 700 million euros ($755.42 million) initially agreed between the buyer and seller.
This is the largest hotel portfolio traded in Spain, according to JLL, which advised Equity Immuebles on the sale. Equity Immuebles is majority owned by the Calero, Briones and Mazin families.
The deal has been given the green light by the European Commission under EU merger regulations.
The portfolio includes full-service hotels in popular tourist destinations throughout Spain, with the majority of hotels located in Madrid and accounting for 37% of the number of rooms. The hotels have “exceptional property quality and diversity of locations, serving diverse segments, including winter and summer leisure destinations, as well as corporate business and MICE,” JLL said in a statement.
One of the standout 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 19thPalace from the 19th century and features a modernist façade and offers panoramic views of the city from its rooftop bar.
The portfolio includes five more Meliá brand hotels in five other cities, eight Tryp brand hotels and three Sol brand properties. The 17 hotels reportedly will be managed by Melia Hotels, based in Mallorca.
“This historic transaction marks an important milestone in the real estate market. The strong interest from global investors, particularly from the Middle East, which accounted for almost 50% of the volume of transactions in Spain in August 2023, underscores the resilient and attractive nature of the hotel sector. It continues to be a major focus for investors looking for dynamic opportunities within the real estate asset class,” said Patrick Saade, Senior Managing Director, EMEA Hotels & Hospitality Capital Markets at JLL.