TOURISM | The Canary Islands are positioned as a leading destination for hotel investment in Spain.
Canary Islands In 2023 it was the main destination hotel investment in Spain. And with a big difference. After a very poor 2022, when investors ignored the Archipelago, last year was again outstanding. Additionally, the islands assume national leadership after a year in which the tourist accommodation sector moved historical amounts. In fact, 4.248 million euros invested in industry The Spanish hotel industry in 2023 will be the second largest in history, behind only the more than 4,800 million in 2018. And of this amount, of these 4.248 million euros, Canary Islands accounted for up to 28%, almost three out of every ten euros.
Far behind Balearic Islands. The Mediterranean region, a perennial rival of the Archipelago for both tourists and capital, benefited last year from hotel investment levels that were 48% lower than those of the islands. Never before has there been such a big gap in favor of the Canary Islands.
Colliers, a consultancy specialized in financial and real estate advice, published this Monday its first balance sheet for holiday housing investments in Spain in 2023. Operations in the archipelago reached 1.175 million euros.. In itself, this figure does not say much, but it represents an extraordinary jump compared to 2022 figures, when capital inflows into the autonomous community’s hotel sector remained at a meager 175 million. So Investment in tourism establishments on the islands increased sixfold in 2023, even more than six times. It is therefore not surprising that the Canarian hotel industry, which is at the forefront of the sector in Europe, has gone from the least attractive to investors in 2022 to the most attractive in the country last year. is more consistent with the leadership that regional housing provides in industry tourism of the Old Continent.
Thus, fiscal year 2022 remains Rare reviewa year in which all other main national destinations are the Balearic Islands, Madrid, Barcelona And Costa del Sol– received more succulent investments than the Canary Islands. Compared to that €175 million in the archipelago, capital invested in hotel activities in the other four main Spanish destinations ranged from €913 million in the Balearic Islands to €225 million in Barcelona. However, last year The amount of injection ranged from 796 million in the Balearic Islands to 560 million on the Costa del Sol, compared with the 1.175 million euros that went to the islands.. From the tail rating to first place in just one year.
4.148 million euros
According to the consulting company Colliers, in 2023, investment in the Spanish hotel business reached 4.148 million euros. Of this total, 1.175 million ended up in the Canary Islands.
28.3% Canary Islands
The mega-operation between Singapore’s sovereign wealth fund and HI Partners was a major one, allowing the islands to capture up to 28.3% of the country’s total hotel investment.
From Colliers This Monday, the “leading role” of the islands was emphasizedwhich lead not only in investment in the Spanish hotel business in monetary terms, that is, in terms of the volume of operations, but also in the number of operations. The 1.175 million euros that the sector received last year are distributed across 39 transactions., the same amount as in the Balearic Islands and significantly higher than the sales recorded in Madrid, where 21 operations were closed; Barcelona, where a total of 11 were signed; and Costa del Sol – 14. The main deal that took place in 2023 in the archipelago was a deal involving GIC, the Singapore government’s investment corporation, and HI Partners, the private equity firm of Blackstone that became the largest hotel company. owner in Spain. Singapore’s sovereign wealth fund has acquired a 35% stake in HI Partners, which has up to 60 assets in the country, for about $1.4 billion. The operation included 27 such assets located in the Canary Islands, which thus became the main target of this mega-deal..
Laura Hernando, Manager hotels in Colliers, explained this Monday that, in addition, investment prospects for 2024 are goodSpain and the Canary Islands have entered a “virtuous circle” that has allowed them to “weather the recent storms by staying the course and move closer to the focus of more and more investors who are beginning to view the hotel holiday segment as asset class (class or type of assets) to increase them portfolios in the short, medium and long term. However, there is a headwind to consider at the start of the year in the form of higher funding and borrowing costs due to the aggressive interest rate hikes that central banks are using to fight inflation. “Most likely, we will have a very dynamic 2024 and we only expect an adjustment in the cost of financing.“, noted Hernando.
About 6000 numbers
The hotel investment data published by Colliers is essentially the same as data managed by CBRE, a US firm that is another big name in the property sector. According to Colliers, the Canary Islands were the main destination for investment in Spain: €1.175 million, 28% of the total, while CBRE analysts raise the figure to €1.194 million, or 29% of total investment in the country. However, the most important thing is that both confirm the leadership of the Archipelago, which with these amounts is “significantly above the average for the last four years,” that is, for the period 2019-2022, CBRE explained. Figures managed by the Los Angeles-based organization show that operations closed last year in the Canary Islands included about 6,000 rooms changing hands. To get an idea of the islands’ leadership in investor preferences in 2023, it is enough to note that out of every hundred euros invested in Spanish hotels in the second half of the year, 87 were in the region. | M.A.M.