FREO to invest €400 million in Spanish hotels
FREO Group, a trusted operating partner of global investors that provides unrivalled access to on-the-ground real estate experts in Europe, the UK and the US, has launched a new platform aiming to invest €400 million in hotels in Spain on behalf of institutional capital.
FREO is currently under exclusivity on a number of transactions, with a significant investment programme planned to reposition the hotels.
As part of its mandate, FREO is considering urban hotels in Barcelona and Madrid, as well as leisure hotels in popular tourist regions such as the Balearic Islands, the Canary Islands and the Costa del Sol. It is targeting well-located hotels that offer the potential to increase value through active asset management and is looking to complete this investment programme over the next three years.
FREO has created a new platform for investment in hotels on a pan-European basis, led by Andrew Hunter, that brings together the group’s skills in finance, development and hotel operations. In 2019, FREO acquired a stake in and agreed a strategic partnership with Michels & Taylor, one of Europe’s leading hotel management and advisory companies. Following this success in Spain, FREO is seeking further opportunities for its capital to other countries in EEA, including the UK, France and Italy.
FREO Spain has established a strong track record in creating value for investors since becoming active in the country in 2015. Led by Daniel Mayans, it has closed approximately €750 million of transactions, both as co-investments and on behalf of institutional investors. This includes well-known developments in Madrid and Barcelona, such as La Sierra and Diagrame, that have been repositioned by FREO to achieve LEED Platinum and WiredScore certifications.
Andrew Hunter, Managing Director and Head of Hotels for FREO, said: “Covid has provided a significant temporary disruption to hospitality but we are long-term believers in the sector. The current surplus of investment capital and support packages for hotels means that we must do more than ride the cycle and our strategy is very targeted, looking only at quality locations with strong upgrade potential to provide a sound investment basis. However, we are also focused on value creation through efficiency and aggregation and will be looking at innovative new products and growth potential, as well as honouring our ESG ambitions by recycling and improving products, retaining and upskilling staff and creating more efficient assets to reduce environmental impact.”
Daniel Mayans, Managing Director and Head of Spain for FREO, said: “Despite the disruption caused by the pandemic over the last year, Spain remains highly attractive to investors as a result of its relative maturity as a market alongside its potential for further growth. The leisure market in Spain is one of the most important in Europe and has a number of excellent operators with inspiring product, but there is space for much more diversity, internationalism and next-generation product. Having completed a significant number of transactions and asset management programmes to deliver best-in-class and futureproofed assets, we are excited to continue our expansion and look forward to announcing further acquisitions in the near term.”
Established in 1996, FREO Group is an independent international investor, developer and manager of high-quality real estate. From 13 offices in Germany, the United Kingdom, France, Italy, Spain, Switzerland, Luxembourg and the USA, FREO has worked on more than 50 projects totalling in excess of 2 million square metres. Further information is available at www.freogroup.com.