CMS advises Extendam on hotel portfolio deal
CMS Albiñana & Suárez de Lezo has advised Extendam and the funds it manages on the acquisition of a portfolio of three hotels located in central Madrid and Barcelona, operated under different IHG Hotels & Resorts brands. Extendam acquired the companies owning the hotels and holding the operating hotel business through two parallel share deals, and refinanced the existing debt.
The portfolio comprises three four-star assets totalling 543 rooms in central locations across two of Europe’s hotel markets. In Madrid, the deal covers the Crowne Plaza Madrid Centre Retiro (157 rooms) and the voco Madrid Retiro (197 rooms). In Barcelona, it includes the recently refurbished Hotel Indigo Barcelona Plaza España (189 rooms), located in the Montjuïc district.
With this transaction, Extendam closed what it described as the largest and most complex M&A deal in its history in Spain, expanding its presence on the Iberian Peninsula, where the manager now holds 35 hotels and more than 4,400 rooms.
The team
CMS coordinated teams across the firm to handle the corporate, real estate, urban planning, financial, tax, employment and regulatory aspects of the transaction. The firm advised on the acquisition of the operating and property-owning companies, conducted legal and tax due diligence, structured the refinancing of the existing debt, and designed an investment structure supporting the assets’ repositioning plan while allowing for the future entry of co-investors through a holding company. The team also renegotiated the hotel management agreements (HMA) with the operator.
Madrid and Barcelona currently concentrate much of the investor interest in the European hotel sector, combining tourism and business demand at record levels with a supply that is barely growing, which sustains the value of well-located assets, according to Javier Colino, Partner in the Real Estate practice and Global Head of the Hospitality, Travel & Leisure group at CMS internationally. Transactions of this kind confirm the appeal of both cities to large institutional investors, he added.
The operation was led by Javier Colino, Partner, and Jorge Durán, Senior Associate, both from the Real Estate department. The team also included Beatriz Madrigal, Rodrigo García-Escorial de León and Luna Mora (Real Estate); Ricardo Héctor, Diego de Miguel, Marta Burgos and Baldomero Fernández-Reyes Falcón (Tax); Cristina Ridruejo, Giuseppe Esposito and Juan Egea (Employment); and Carlos Vérgez and Aida Oviedo (Competition).
