A fund overseen by ActivumSG Capital Management, the turnaround and opportunistic real estate fund manager, has sold the 161-guest room Hard Rock Hotel Madrid it established in the heart of the Spanish capital’s Museum District to Arlaes Management, S.L., an investment and management company comprised of international investors, for 65 million euros.
ActivumSG Iberia Fund I acquired the former municipal office building opposite the Museo Nacional Centro de Arte Reina Sofía in the Atocha district of Madrid after ActivumSG’s local team saw the potential to convert it into a hotel because of its close proximity to the city’s major tourist attractions, business center and principal shopping boulevards.
The investment fund acquired a municipal office property located opposite the Museo Nacional Centro de Arte Reina Sofía, in Madrid’s Atocha district, after ASG’s local team saw its potential to convert it into a hotel due to its proximity to the city’s main tourist attractions, business centre and shopping area.
The 12,598 square meter hotel opened its doors to guests in July 2021. This followed intensive asset management by ActivumSG to obtain planning consent for change of use, the acquisition of an adjacent plot for broadening the future hotel’s amenities and overseeing the extensive works to transform the building. The team also signed a management agreement with Hard Rock International, which will continue to operate the hotel featuring restaurants and bars, an outdoor swimming pool in the gardens, a fitness center and a guest car park.
Brian Betel, ActivumSG’s head of Direct Transactions in Europe, said: “We’ve taken this hotel project from a concept through to an operational asset primed for new ownership, in line with our development strategy of creating and selling great hotels. Our pan-European hotel strategies started in 2015, when we began to assemble a portfolio of assets in Spain’s major destinations. We went on to acquire Odyssey Hotel Group last year for scaling its footprint across the continent. We’re positive about the sector, anticipating a rebound in tourism and eventually business travel as the COVID19 pandemic recedes, so we’re looking for fresh investment opportunities.”
Advising ActivumSG Iberia Fund I on the Madrid hotel sale were JLL and Latham & Watkins, while Knight Frank and Eversheds Sutherland acted for Arlaes Management, S.L
Latham & Watkins advised ASG with a team led by Madrid office Corporate partner Rafael Molina, together with associate Luis López.
Eversheds Sutherland advised Arlaes Management with a Madrid office team including Real Estate head partner Javier Ibáñez Gabemet, along with Real Estate lawyers María Ortega Beneit and Andrés Ponce Lorza.