Freo to invest €400m in Spanish hotels

European real estate specialist Freo Group has launched a new platform aiming to invest €400 mln in hotels in Spain on behalf of institutional capital.

Freo said it was 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. In 2019, the firm acquired a stake in and agreed a strategic partnership with Michels & Taylor, a European hotel management and advisory company.

Hunter 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.'

Freo became active in Spain in 2015 with a team led by Daniel Mayans. To date, it has closed approximately €750 mln of transactions in the country, both as co-investments and on behalf of institutional investors.

Mayans 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.'

Following the Spanish plans, Freo said it was seeking further opportunities for its capital in other EEA countries, including the UK, France and Italy.



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