Eurazeo Sells its Spanish FST Hotels to Extendam for Approximately €100M
Eurazeo has completed the sale of its stake in FST Hotels, a Spanish hotel portfolio that includes three establishments located in Madrid and Barcelona, to Extendam, a European private equity fund specializing in hospitality. This transaction concludes the investment cycle started in 2022 and generates distributions in line with the net asset value at the time.
A Refurbished and Repositioned Portfolio in Two Years
The initial portfolio, acquired in 2022 through a joint venture, included five hotels totaling 800 rooms operated under the Ayre brand. Over four years, the joint venture embarked on a strategic transformation program involving the divestment of non-strategic assets, complete renovation, and rebranding. The three retained assets in Madrid and Barcelona (543 rooms in total) were integrated under three brands of the InterContinental Hotels Group (IHG), one of the world's leading hotel franchisors.
This repositioning was accompanied by operational improvements in a favorable context: tourism growth in Spain supported the appeal of the modernized hotels, particularly among international clientele. The renovation program also incorporated goals for reducing water and energy consumption and carbon emissions, in line with Eurazeo's sustainability commitments.
Total Distributions of €100M Over the Investment Period
The transaction was concluded at a value consistent with the last published net asset value. Over the investment period, total distributions to the partners of the joint venture amounted to approximately €100M, of which about €50M were attributable to Eurazeo.
Following the sale, the portfolio will continue to be operated by Grape Hospitality, Eurazeo's pan-European hotel platform. This management agreement highlights the latter's in-depth expertise, particularly in the Spanish market.
Validation of a Strategy in Real Estate and Operational Excellence
Through this transaction, Eurazeo confirms its ambition to support European companies at key stages of their growth, while demonstrating the quality of its assets and its expertise in creating real estate and operational value. The co-directors of the Real Estate strategy, Riccardo Abello and Pierre Larivière, stated that this transaction 'reaffirms Eurazeo's operational and real estate expertise and marks the successful conclusion of a partnership in a highly attractive European hospitality market, validating both our strategic vision and our execution capabilities.'
