Abu Dhabi Investment Authority (ADIA), one of Abu Dhabi's sovereign wealth funds, has finally closed this week one of the most important hotel operations in recent years with the purchase of 17 hotels owned by the Equity Inmuebles fund.
According to CincoDías, the contract was sealed this week and the transaction has finally been closed at around 600 million euros, below the 700 million initially agreed by buyer and seller. The transaction must now be approved by the European competition authorities, which could veto it.
The transacted portfolio consists of 17 hotels. The most representative asset is the hotel ME Madrid Reina Victoria, located in the centre of Madrid, together with five other hotels of the Meliá brand in five other cities (Madrid, Marbella, A Coruña, Chiclana de la Frontera and Baqueira Beret). The second tier includes another eight Tryp brand hotels (two of which are located on Madrid's Gran Vía) and three Sol brand properties.
ADIA protagonists the most significant hotel transaction in recent years"
The 17 hotels will continue to be managed by the Balearic hotel company Meliá. In his speech to the general shareholders' meeting last Thursday, Meliá's CEO and new chairman of the board of directors, Gabriel Escarrer, referred to the deal, provided it passes the scrutiny to which it will be subjected by European Competition Commissioner Margrethe Vestager. "Meliá will continue to operate the aforementioned establishments under management. In addition, the most representative hotels of the new portfolio acquired by ADIA are expected to undergo a process of renovation and product transformation supervised by Meliá, in order to enhance their value and maximise their results", said Escarrer.
The purchase of this portfolio is the second operation closed by Meliá with ADIA. The first was the acquisition of seven hotels from a company co-owned by the Balearic hotel company and the Avenue Capital fund, which has already been approved by the European competition authorities. The company stresses that both agreements will be very important and positive, as the hotels formerly rented will be incorporated through management contracts.