Israel’s Fattal Group has agreed to buy a collection of six Spanish hotels from KKR and Dunas Capital for upwards of €165 million.
The properties — four hotels and two apartment hotels — are located on the Balearic islands of Ibiza and Mallorca, and currently form part of the Alua Hotels & Resorts chain, part of Hyatt-owned Apple Leisure Group.
The transaction is the first by Fattal as part of a joint venture with institutional investors Menorah, Harel, and Leumi Partners.
The partnership will finance the transaction from its own sources, in addition to a loan of approximately €95 million that the partnership intends to receive from a banking entity.
The purchased hotels are:
- Alua Hawaii Ibiza (209 rooms),
- Alua Miami Ibiza (360 rooms),
- Aluasun Miami Ibiza apartment hotel (82 Apartments),
- Alua Hawaii Mallorca & Suites (230 rooms and 68 Hawaii Mallorca Suites)
- Alua Palmanova Bay (170 rooms)
The current owners the hotel have spent more than €14 million in renovations and
Fattal plans to invest a further €20 million in enhancing the facilities, amenities, and overall customer experience. In due course the properties are expected to rebrand to the group’s well-known European hotel brands such as Leonardo, Leonardo Royal, and NYX.
The transaction is expected to close in the second half of 2022 and will not impact guest reservations or experiences.
KKR, asset manager Dunas Capital and the hotel group Alua Hotels and Resorts announced an agreement to acquire and manage the then Intertur Hotels group back in 2017.
The Fattal hotel chain, owned by the Fattal family (62.08%), was established by David Fattal in March 1998, and specializes, through corporations it holds, owns, operates, rents, and manages, in hotels in Israel and Europe, as well as in the acquisition and construction of new hotels. The company currently has more than 44,000 rooms.
What they said
Guy Vardi and Yaniv Amzaleg, who oversaw the transaction on behalf of Fattal, said: "This exciting acquisition reflects Fattal's ability to identify strategic opportunities and complete transactions of significant scale with top-tier international sponsors and partners. It presents us with a rare opportunity to acquire a high-quality portfolio of assets, timed to capitalize on the potential for a near-term return to travel, as well as the hotels’ fantastic locations - which will remain in high demand for years to come. In addition, through effective management, branding, product enhancement, and targeted investment there is a significant opportunity to grow value and generate strong returns for our investors.”
Guy Vardi and Yaniv Amzaleg recently joined Fattal to lead Fattal's international M&A activities and joint venture. The two bring with them extensive experience on a significant scale in international transactions, having led international investment activities in recent years.
Rosa Brand, director in EMEA real estate at KKR, added: “Since acquiring these hotels in 2017, we have invested significantly to transform and modernise the portfolio alongside our partners Dunas Capital and Alua, consistent with our European strategy of working with best-in-class local developers and operators. We are delighted that Fattal Group will be the new owners of the portfolio.”
Shai Raz, CEO of Fattal Hotels in Spain, said: "In recent years, Fattal has built a strong and profitable management platform for our hotels in Spain, that is consistent with the company's ambitious growth strategy to expand in the most attractive areas of the European continent. We are delighted that with this deal we have created a strong presence on the Balearic Island and strengthened our overall position in Spain by bringing the total number of Spanish hotels to 16.”