Ibiza hospitality and hotel news-
With Easter happening this year in March and the island basking in glorious weather, winter hibernation draws to a close and planning the 2024 season kicks into gear.
The expectations are good for the coming season, the show must go on and the buzz of the island awakening is very present.
New hotels, new owners and new venues will come into play this season, investment continues to be high and large sums are still being deployed into the hotel and hospitality sectors, as well as the residential real estate projects across the island are being developed at a vertiginous pace.
The season will start ealier on the make of an early Easter and many venues are looking at official opening to take place as of the end of April extending the season well into October.
Property Prices continue to grow and stand at all time highs, hotel rates in Ibiza are the highest in Spain and restaurant have increased prices considerably since the pandemic.
We should start to see some consolidation of prices at all levels as well as a topping out in terms of tourist visits and spend for this year.
What happening in Ibiza these days ?
Hotels Investment – Oak Hill Advisors looking to sell Hotel Presidente Ibiza
Oak Hill Advisors purchased the 270 room hotel in 2018 with the view to invest in the €20 mm renovation and transformation from a three star to a five star.
The hotel which has been closed since, has all the licenses for the renovation project and is currently valued at €30 mm.
Meridia Capital, a Barcelona based asset manager specialised in hospitality has over a billion euros under management would bring in an operator after its renovation.
Hospitality News – Pacha Year 2023 Results
The Dubai based FIVE Holdings led by CEO Kabir Mulchandani has closed out the acquisition of the Pacha Group from a consortium led by the previous owners, Trilantic Capital Partners.
The final price tag was some €270 million and was delivered debt free.
The group has just published its 2023 year end figures with sales of €105 mm and an EBITDA of close to €35 mm
The club held 161 parties averaging a revenues per party of €386 m serving over 500,000 guests with an average spend of €123 pp
The group also repurchased the Hotel Pacha and adjoining parking lot from the Reubens Brothers for €53.8 mm financed through a €38 mm loan. The group plans to develop high end apartments for sale and leaseback on the plot.
This will be the first full season with its new owners and already the feeling is that the flagship has been stabilised and the stewardship of industry professionals is very apparent.
For the moment, Trilantic will retain ownership of the restaurant club brand Lío, known for its cabaret shows and fine dining experiences.
Hotel Investment News- Gruppo Statuto negotiating the purchase of Six Senses Ibiza from Metric Capital
The Six Senses Ibiza, brainchild of the architect and developer Jonathan Leitersdorf, with 116 rooms and 8 private villas, and owned by Metric Capital is said to be in negotiations with the Italian Gruppo Statuto.
The hotel, the first Six Senses in Spain was opened in 2021, after the acquisition in 2017 and a major refurbishment of the old three star Hotel Vista Bahia. Metric Capital participated in the project in 2017 with a €52.8 mm loan.
Gruppo Statuto, a hospitality real estate investment group led by Giuseppe Statuto, hit the headlines last year with the record setting acquisition of the 96 room Six Senses in Rome for €245 mm and closing out the purchase of the 135 room Mandarin Oriental in Paris for €205 mm earlier this year. The group is already present in Ibiza having bought the 125 room W hotel in Santa Eulalia in 2023.
Stay tuned for what could be a milestone in Spanish hotel transactions.
Investment – New Law provides an opening for legalising properties
The current government is studying the possibility of legalising properties that have been fined for illegal construction and have not been able to register these changes into the land registry. The condition is that the fines must have prescribed in three years and a fine must be paid.
The move is a sensible one and hopefully will start to pave the way for recognising the legal impasse that has been prevalent on the island for decades and offer solutions for owners that want to regularise their properties.
This will also help improve investor confidence and more transparency and allow for a significant amount of houses to become fully and legally registered and facilitate transactions to flow easier.
This is good for the property market.
Hospitality News – So, now that Pacha has been sold, what ‘s happening with Lio?
Arguably the most profitable cabaret /restaurant in the world. Lio was left out of the purchase of Pacha by the Five Holding group, and still remains in the hands of the investment funds led by Trilantic.
No doubt a valuable asset that generates significant revenues and an impressive operating margin possibly in one of the best locations in the world. The caveat being the lease on the venue ends in 2025 and will very likely have to compete with other players at a significantly higher lease cost.
Presumably Trilantic would be till trying to sell the asset which includes Lio Mykonos, Lio London, Lio Dubai and as well as pipeline LOI deal. We would expect other groups to be preparing bids for the concession. Stay tuned !
Hotel News – Mondrian a new addition to the Ennismore Hotels Portfolio
Another exciting addition the Ennismore Hotels Group portfolio located in the quieter Cala Llonga beach close to Santa Eulalia.
Mondrian Ibiza, opening this year in April, with 154 rooms, with direct beach access and two spectacular pools overlooking the scenic bay and sharing facilities with its sister next door Hyde. and 7 different restaurant to choose from.
Another great addition to the islands growing quality choices!
Centenary Club Nautico Ibiza changes hands after 99 years.
After many months of dramatic play outs between the existing concession holders of the club and the, what some see as opportunistic or even speculative, contenders the Ports Authority have conceded a 1year concession that is extendable for a further 4 years to the contenders amidst a major upheaval across many spectres of Ibizan society.
The winner of the bid promised changes only for the better and has emphasised investments in the much needed improvements in infrastructure as well as the better promotion of the sailing school. Also the bid contained addressing some of the ecological improvements and monitoring in the water surface a key differential
Counter allegations are being made by the incumbents but it is unlikely to change the outcome and it remains to be seen whether this is a genuine bid for improving the club and all its social elements or just another short term speculative money making operation. we are hoping for the former but time will tell
Lets check some of the recent figures for the real estate market
The Ibiza real estate market prices are at all time highs. The market is beginning to show some signs of a slowdown with residential sales falling. A very strong season adds to the economic well being of the island. Property prices will start to consolidate.
A few words about politics…
The center right party PP (Partido Popular) obtained a majority in all the Ibiza municipal elections in May this year. As did the insular government, the Consell d’ Eivissa and the autonomous government in Palma.
This has strongly reinforced the capacity to execute their program with little hindrance and hopefully address some of the pressing issues the island has. No excuses this time round and there is sufficient gunpowder in the budgets.
The general election July finally paved the way to a socialist (PSOE) led coalition government. The the center right party, the PP, failed to obtain sufficient majority in the first round. Ibiza and the autonomous Balearic government are governed by the PP. This possibly making it a little cumbersome to influence the central government. Still, nonetheless have enough power to instigate necessary solution to addressing issues that require urgent solutions
Budgets for next year are being approved at the moment. All are seeing increases and there are funds available to work on necessary solutions. Lets hope that this money is put to good use. While the challenges are there, we should start to see some improvements in areas that most require it most. Those being infrastructure and housing.
Keep your eye on…
Something has got to start moving around these venues at some point
Ibiza in the press
