Spanish hotel operator Melia Hotels International will acquire thousands of hotels rooms at key resort locations in Spain under a joint venture deal with private investment company Starwood Capital Group.
A controlled affiliate of the equity investment group will own 80% of the joint venture company, while Melia Hotels International will own the remaining 20%.
The initial portfolio for the joint venture consists of seven well-established beachfront hotels representing 2,933 keys that are currently owned by Melia Hotels International and will continue to be managed by Melia upon completion of the transaction.
The properties will be acquired by the joint venture in a transaction valued at €176 million (GBP127.6 million), subject to the approval of the European Union Merger Control Office.
The Sol Principe in Malaga, the Sol Lanzarote and Melia Gorriones (Fuerteventura) in the Canary Islands, the Sol Ibiza and Sol Pinet Playa in Ibiza, and the Sol Mirlos and Sol Tordos in Mallorca will all be fully refurbished in the initial investment drive, and some will be rebranded.
The Sol Mirlos and Sol Tordos will be renamed as the Sol Palmanova, Sol Ibiza will become Sol Beach House Ibiza and Sol Pinet Playa will be renamed Sol House Pinet Ibiza.
The main portion of the Melia Gorriones property will continue to operate under the Melia brand, and the current annex will be rebranded as Sol Beach House Fuerteventura.
The joint venture will seek out further opportunities to integrate additional properties into the portfolio, adding to Starwood Capital’s $63 billion (GBP40 billion) real estate portfolio, which includes 2,300 hotels and resorts.