By Laura Kemp • 22 May 2020 • 12:22
Credit: Hotel Condes
AN anonymous yet potential buyer explained that the bargain “market had stopped completely, but in the last two weeks it has shyly begun to offer new opportunities and even reactivate some older ones.”
This is not only an issue in Spain as the entire world is currently dealing with an unprecedented pandemic and trying to re-adjust to the consequences that Covid-19 has brought with it. However, as time goes on and hotels remain shut an increasing amount of business owners in the industry are doubtful about the return of normality and already accepted this summer season to be a lost cause. This sentiment is fuelling hotels to choose to cut their losses ahead of time and begin putting their properties on the market.
Although there are an array of different sale techniques, market experts are betting on the ‘Sale and Lease Back’ method to be the most prominent within the industry especially as this type of sale is especially designed to help sellers cope with the need to liquidate to carry on with business.
Liquidation is what most hotels in Spain are trying to achieve so that they can confront the massive break they are currently experiencing in income which has occurred as a result of the coronavirus and its effects on the flow of tourism. This lack of income is not expected to regain its usual pace any time soon and in order to make up for lost time, hotels will have to remain in a sticky situation at least until next spring.
Looking at this theory of necessary liquidation in reality can now be witnessed across the whole of Spain. For example, in Barcelona there are already three establishments for sale; the Condes and Monument, situated near the acclaimed Paseo de Gracia, and the Fonda España, near the Liceo, all three of which are part of the Cadarso hotel portfolio.
Despite the current global climate, there is still quite a lot of liquidity available in the large international funds, these are the natural candidates who will buy these hotels as they are the ones with the funds available to do so. The global appetite for alternative investment and opportunity to purchase cheap bargain properties has risen in the context of the coronavirus crisis.
It is not only luxury and large high-end hotel chains which are struggling as there are also family-owned businesses, especially amongst the three to four star hotels which are in trouble. These hotels, typically, located on the second or third streets behind the beach front in areas like Costa del Sol’s Marbella or on the sea front of Almeria and Granada, are also facing the pressure to liquidate their business and survive through the season-less summer.
Experts fear that this is only the first batch of ‘opportunistic deals’ that the nation will experience and that many more businesses will be forced to kneel against the financial pressures of the health crisis, especially if normality is not regained until 2022.
Share this story
Subscribe to our Euro Weekly News alerts to get the latest stories into your inbox!
By signing up, you will create a Euro Weekly News account if you don’t already have one. Review our
Originally from UK, Laura is based in Axarquia and is a writer for the Euro Weekly News covering news and features.
Got a news story you want to share? Then get in touch at [email protected]
Your email address will not be published. Required fields are marked *
Downlaod our media pack in either English or Spanish.