It is proposed to reposition the hotel with an international luxury operator
RLH Properties has broken into Spain with the purchase of the Hotel Villa Magna in Madrid for 210 million euros, the Turkish group Dogus, an operation expected to materialize in mid-December and is an “important milestone” in its investment strategy in hotel assets and a first step in its international expansion, in which it expects to announce future investments in Europe.
The Mexican Socimi RLH, chaired by Allen Sanginés-Krause, has closed the purchase of the hotel Villa Magna in Madrid to the Turkish group Dogus for an amount of 210 million euros, an operation that is expected to materialize in mid-December, as it has The company communicated to the Mexican Stock Exchange (BMV).
As business opportunities, RLH points out the possibility of studying the potential repositioning of Villa Magna with an international luxury operator or, among other relevant opportunities to reposition the asset, make a pool or acquire land located on the right side to make residences , expand the hotel inventory or place the pool in this area.
The approximate price of the operation amounts to 210 million euros, which includes the value of the Villa Magna brand, and represents a record in the market when it exceeds the 180 million euros paid by its previous owner, the Turkish ‘holding’ Dogus, two years ago.
The acquisition was then closed for 180 million euros in what was the largest operation in Spain in price per room (1.2 million per room), ousting the acquisition of the Hotel Arts, the Westin Palace or, the most recent, the Ritz, which Olayan and Mandarin closed in 2015.
EXPANSION IN EUROPE
“The acquisition of Hotel Villa Magna, one of the most representative of Europe in the luxury segment, also confirms our enormous confidence in the Spanish market, one of the most dynamic and attractive in the world,” said the chairman of the executive committee of RLH and founding partner of BK Partners, Jerónimo Bremer.
The managing director of RLH Properties and partner of BK Partners, Borja Escalada, explained that this purchase of this emblematic luxury hotel in Madrid is also a first step of international expansion. “We believe that this transaction is excellent news for our investors and shareholders and we hope to announce new investments in Spain and Europe soon,” he said.
RLH Propierties is currently the owner of other assets of the Four Seasons Hotel in Mexico City, the ‘Hotel Rosewood Mayakoba’, the ‘Banyan Tree Mayakoba’, ‘Andaz Mayakoba’, ‘Fairmont Mayakoba’, the PGA El Camaleón golf course and the Mandarina Development ”, which includes the One & Only Mandarina Hotel, currently under construction, the ‘Hotel Rosewood Mandarina’, in development, along with residential developments.
TERMS OF THE OPERATION
The purchase of the luxury hotel located in Madrid’s Paseo de la Castellana is still pending, among other conditions, the approval of the general meeting of shareholders of the Mexican, which has been called for next December 7. The socimi intends to complete the acquisition by purchasing 100% of the capital stock of the company Hotel Villa Magna from the company D Hospitality B.V ..
As advisers they have acted, on the side of the buyer, Credit Suisse, as financial advisor, and Pérez-Llorca, as legal advisor; and on the side of the seller, JLL, as real estate investment adviser and Clifford Chance, as legal advisor, as detailed by the Mexican socimi.
The five-star, 150-room Villa Magna was inaugurated in 1972 and completely renovated in 2008 by the previous owner. He was born to compete as a modern establishment in front of other hotel offers and lead the luxury segment. Historically it was managed by Hyatt between 1990 and 2007.
It has an area of 29,738 square meters and 7,500 square meters of plot, 10 floors and 5 underground. In addition to its 150 rooms, including 30 suites, it has two restaurants, the ‘Villa Magna’ and the ‘Tse Yang’, and two bars, ‘Magnum Bar’ and ‘Patrio Magnum’. It has 240 underground parking spaces, spa with gym, ballroom of 675 m2 with capacity for 560 people and three meeting rooms with a combined size of 139 square meters and capacity for 80 people.