Spanish REIT Millenium Hospitality Real Estate Acquires 109-Key Iberostar Las Letras Hotel Madrid For €70m
Main Photo: The Iberostar Hotel in Madrid
Date: November 2022
Name: Iberostar Las Letras Gran Vía
Location: Gran Via, Madrid, Spain
Number of Keys: 109
Seller: TBA…management was provided by Iberostar
Buyer: Millenium Hospitality Real Estate, with this being their 12th hotel. The American fund Castlelake owns 49.72% of Millenium since July 2021. Additional stakeholders include Mutualidad de la Abogacía, José María Castellano and Javier Illán, the president and CEO of the vehicle.
The Spanish REIT, Millenium Hospitality Real Estate, who specialises in luxury hotel investment, continues to grow its portfolio. The latest acquisition of the Iberostar Las Letras Gran Vía hotel means the vehicle now owns 12 hotels worth approximately €550m with this being it’s 4th investment in the center of Madrid. Projects in the capital city include the JW Marriot, Nobu Madrid and another in Calle Zorrilla.
The transaction closed for a total of €70 million and was financed in its entirety by Millenium. The four-star hotel on Gran Vía 11 has 109 rooms and is operated by Spanish giant, Iberostar. Located in an area of Madrid which is consolidating as a luxury hotel district with the recent openings of the Four Seasons and the Hyatt Centric in Gran Vía. Additionally, Millenium plans to open the JW Marriot hotel by the end of the year, located in this same district next to the Plaza de Canalejas.
The Spanish vehicle now owns 12 hotels of which 5 are operational, under brands such as Radisson and Melia, the rest are either in development or under conversion. The company will follow with openings in 2023 of the Nobu San Sebastián hotel, a hotel in Madrid on Calle Zorrilla 19 and the Plaza San Francisco hotel in Seville.
Millenium intends to complete its investment process, which began with a capital increase in July 2021, and reach a GAV of their portfolio of around €1bn in the short-medium term. It currently has investments under study worth around €500m. In fact, it became known recently that the company was studying a new luxury hotel opportunity in Marbella in a plot owned by Platinum.
Among the company’s short-term plans is also to join the Mercado Continuo, Madrid’s stock market, with the aim of improving the liquidity and visibility of their market value. The latest earnings announcement by the Spanish REIT showed 15.8 million euros in profits as of June this year, which is more than double their results in the same period last year. This increase is partially explained by the value appreciation of their portfolio by nearly €10m euros with respect to last year.
The American fund Castlelake owns 49.72% of Millenium since July 2021. Additional stakeholders include Mutualidad de la Abogacía, José María Castellano and Javier Illán, the president and CEO of the vehicle.
Price: €70m
Price per Key: €642k
THPT Comment: Well done Millenium, on it’s 12th hotel acqusition…and looking forward to continued growth if it launches onto the Madrid stock market…Fab!
First Seen: Spanish REIT
The Hotel Property Team (THPT) is a small group of highly experienced business professionals. Between us, we provide a range of skills and experience which is directly relevant to those involved in the hotel property market. For more information – Visit www.thpt.co.uk or email [email protected]
