Singapore in Spain: hotel business development

The recent acquisitions of Singapore's sovereign wealth fund (GIC) have made it a strategic player in the Spanish hotel real estate market, Desarrollo reports. This small Pacific nation has become the main East Asian representative in the Spanish tourism real estate market.

The purchase of a 35% stake in the country's largest hotel owner, such as HIPartners (HIP), from Blackstone makes GIC a prime candidate to buy the entire sotimi in case the US fund decides to fully exit this project, founded by Bay (Sabadell) and Hispania (Azora).

In addition, GIC also owns the five-star Palace and Edition hotels in Madrid through a joint venture with Dutch pension fund APG called Archer. In September 2022, Singapore announced the purchase of a majority stake in the Sani/Ikos Hotel Group, which operates 10 hotels with 2,750 rooms in Greece, Portugal and Spain. As part of this deal, the Ikos Andalusia hotel opened in Marbella in 2021 and the Ikos Porto Petro hotel opened in Mallorca last summer.

GIC is characterized as a conservative fund and is a long-term partner as its investments remain in the market for a long time. A luxury Banyan Tree hotel in Marbella and Mallorca under the Singapur brand is scheduled to open soon, confirming the growing interest of East Asian countries in investing in Spanish hotel real estate.

Major players from Thailand, China, the Philippines, Hong Kong, Malaysia and Japan are actively investing in luxury tourism projects in Spain, given the growing demand for high-end tourism. Thailand's Minor has made a big bet by absorbing the national hotel chain NH and developing new brands, concepts and markets.

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The Chinese from Jin Jiang have also taken a step forward by acquiring Radisson through Choice and have a strong presence in Spain, where they also have ambitious plans. Chinese capital is also actively expanding its hotel operations, for example Mandarin already operates in Madrid and Barcelona, with openings planned in Seville as well as Mallorca, where Valparaíso has become one of the symbols of their incursion into the luxury segment. From Hong Kong, Gaw Capital is part of the Hospes investment project with Alicia Koplowitz, and owns the Platinum property and the Rosewood hotel that goes by the name Villa Magna in Madrid. A major player from Thailand has also acquired a hotel of its prestigious brand in Seville, while a company from Malaysia has become the owner of Mandarin in Madrid.

East Asian capital is thus quietly conquering the luxury hotel real estate market in Spain, showing its confidence in the future development of the tourism segment of the entire country. Singapore is emerging as a key player in Spanish hotel real estate investment, alongside major tourism property owners such as Abu Dhabi, Azora, Millenium, Brookfield, Stoneweg, Angelo Gordon, Fattal or Mazabi, as well as local hotel chains including Riu, Meliá, Iberostar, H10, Catalonia, Globales, Hipotels or Barceló.