It was a typical operation by the reclusive billionaire Spanish investor.
Last summer, Swedish real estate developer Genova Property Group announced its sale of two luxury hotel properties on the Mediterranean island of Mallorca for 35 million euros, but it took until December for Spanish media to identify the buyer as the country’s wealthiest man, Amancio Ortega.
Also typical were his purchases. One, Nobis Hotel Palma, is a five-star, 37-room property housed in a former Moorish palace dating to the 12th century and the other, Concepció by Nobis, was once a soap factory built in the 16th century.
Both are operated by the Stockholm-based Nobis Hospitality Group which ran the hotels before the purchase and now operate them under a 20-year lease agreement with Ortega’s investment fund, Pontegadea. The deal reflects its business model of purchasing existing and prestigious properties with well-established tenants, industry sources said.
“Pontegadea qualifies for what is considered a 'core investor’. They get involved in opportunities that already present solid unquestionable value in the long term,” explained Ivar Yuste, partner with Madrid-based hotel consulting firm PHG Hotels & Resorts.
“These opportunities have to be clean deals, minimum size around 20 million or 30 million euros, no developments, no land, established operating hotels, predictable cash flows or rents. And they must be reputable brands with solid business fundamentals.”
Busy year
Last year was a busy one for the 87-year-old property tycoon. Along with the two Mallorcan hotels, he bought a logistics center in Dublin used by Amazon for 225 million euros, a refrigerated warehouse in Florida for 103 million euros and a distribution facility in the Netherlands with cut-price retailer Primark as tenant.
A year earlier, Ortega had purchased seven logistics centers across six U.S. states for 905 million euros with leaseholders like Home Depot, Nestlé and FedEx.
And he is not only active in hotels and warehouse distribution centers. Also in 2023, Ortega snapped up a building housing 120 luxury rental units in the Irish capital for over 100 million euros and a 45-story building with 492 high-end apartments in Chicago for 212 million euros.
Ortega’s hotel portfolio includes the four-star Senator Playaballena resort in southwestern Spain, the 205-room Iberostar 70 Park Avenue in New York City and the 216-room Eurostars Magnificent Mile on Chicago’s State Street.
Extensive holdings
Across his extensive holdings, Ortega also owns energy plants, retail properties, and office buildings rented out in whole or part to companies like Apple.
“Pontegadea has a very diversified investment strategy”, Yuste said. “They acquire across all asset classes and all established geographical markets. They have a sizeable in-house acquisitions team structured by regions.”
Along with the investment fund’s headquarters in A Coruna, Spain, in Ortega’s northwestern home region of Galicia, it also has offices in Madrid, London, Paris, Miami, Lisbon and Toronto.
Listed by Forbes as Spain’s richest individual with a net worth of $99 billion and ranked the third richest person in Europe, Ortega got his start in business making bathrobes and lingerie in his native Galicia in 1963.
Two years later he opened the first Zara women’s clothing store which went on to pioneer the now widely-practiced concept of “fast fashion” and was the foundation for the creation of a string of additional brands.
Zara billions
Under the name Indetex, the group now includes clothing chains which are features on high streets and in shopping malls around the world such as Zara Home, Oysho, Bershka, Massimo Dutti and Stradivarius.
Pontegadea owns 59 per cent of Indetex and reportedly takes in around 2 billion euros every year in dividends, along with another 1 billion in rental earnings and other income, plowing much of it into real estate.
Last year, according to press reports, the fund invested over 1 billion euros and its worldwide property portfolio is now worth around 20 billion euros.
The propensity for hotel investment is a family trait.
Ortega’s daughter, Sandra, the second wealthiest person in Spain with a fortune estimated at 7 billion euros, has owner-tenant relationships with such leading marques as Barceló, Crestline Hotels & Resorts, Palladium and NH Hoteles through her investment group, Rosp Corunna Participaciones.
The family office includes Ferrado Hotels which recently opened the three-star 45 Times Square Hotel in the heart of Manhattan and is managed by Palladium Hotels and Resorts.
Like her father, Sandra Ortega keeps a low public profile.
But her business dealings made headlines back in 2021 when she pulled out of her 31 per cent investment in the rapidly-expanding Spanish chain, Room Mate, which, along with the effects on the hotel sector from Covid-19, led to its brief bankruptcy.
She was back in the headlines several months later with the news that she had reportedly invested 150 million euros in the super-luxe Bulgari Hotel Paris along with Saudi partner Osama Al Sayed.
And the Ortega business tradition continues. Earlier this month, Sandra Ortega named her three adult children, Antía, Martiño y Uxía, to the family office’s board of directors.