Redevco and Swiss Finance & Property Group have teamed to form a hotel joint venture focused on acquiring hotel assets in Spain and Portugal.
Following a first close, a fund managed by Swiss Finance & Property has indirectly taken a majority stake in ‘Next Gen Stays,’ which currently comprises a seed portfolio of six assets in Lisbon, Porto, Bilbao, Malaga and Seville.
The strategy is targeting a net levered IRR of 15 per cent plus over a five-year period and aims to build up a portfolio of around €300 million.
The joint venture will focus on redevelopment opportunities, refurbishing hotels for its target consumer base of millennials and Gen Z travellers. Redevco said the refurbished hotels will be compatible with its mission to make its entire real estate portfolio net carbon neutral by 2040.
Why it matters
This emphasises a growing market for refurbishing underutilized or outdated hotel assets, aligning with broader real estate trends favouring adaptive reuse, with the JV seizing the opportunity to breathe new life into - and benefit from - hotel assets with potential in the fragmented Southern European market.
What they said
Hannah Evans, investment director at Redevco said: “Our value-add Next Gen Stays strategy is an excellent example of Redevco’s focus on repurposing assets to create vibrant places in urban locations. By acquiring and redeveloping strategically located and under-exploited real estate with local character, we create an attractive investment product and make cities more sustainable.”
Patrick Brenninkmeijer, business development director at Redevco said: “Redevco and SFP will now be working to capitalise on the resurgence and growth in the youth tourism and experience travel market and we look forward to creating a professionally managed hospitality portfolio in key cities in the Iberian Peninsula together.”
Philipp Braunwalder, CEO Swiss Finance & Property UK said: “Working alongside Redevco on yet another project tailored for the younger demographic has been both fulfilling and inspiring. We are excited to venture into the hospitality sector with a trusted partner by our side. At SFP, our commitment to providing innovative real estate solutions for future generations remains steadfast, while prioritising community enrichment and sustainable development.”