Meridia has partnered with B&B Hotels to develop a platform of budget hotels with high ESG standards in Spain.
Meridia will become a key financial partner in B&B Hotel’s expansion programme in Iberia, investing €200m for the acquisition of land in order to build 100 to 200-room hotels on the outskirts of major cities in Spain. These hotels will be leased to B&B HOTELS on a fixed contract basis.
Meridia will develop this strategy in collaboration with Lexxa Hotels, which will assist in identifying opportunities, executing development work, securing financing and managing the exit.
Meridia says the hotels will be developed and operated according to the highest sustainability standards and will be certified with internationally recognised credentials, such as LEED or BREEAM.
Through its fund Meridia IV, Meridia has already made the initial investments for this program, acquiring four plots of land; one in Vallecas (Madrid), two in Seville, and one in Vilaseca (Tarragona). The four properties will have a total of 500 rooms and will be operational from 2024.
Meridia says it is continuing to explore similar operations in locations with high demand for this type of product, adding that it expects these to come to fruition in the coming months.
Why it matters
Meridia’s interest in the budget hotel market – especially in a tourist destination such as Spain – comes at a time when post-pandemic holiday demand and a cost-of-living crisis co-exist side by side, resulting in a boost in performance for budget hotels.
What they said
Héctor Serrat, real estate partner at Meridia said: “The sector's resilience, the growth potential of the platform, and the proven liquidity for this type of product make this project a great opportunity. We are proud to have partnered with B&B HOTELS and Lexxa, leading companies in their respective fields, to develop this project.”
Lucía Méndez-Bonito, CEO of B&B HOTELS Spain & Portugal added: “We are very excited about this partnership with Meridia. B&B HOTELS is growing rapidly in Spain & Portugal. We closed 2022 with 52 hotels in Iberia, and our forecast is to reach over 60 in 2023. We are convinced that this alliance with Meridia will be key to maintaining a robust pipeline and increasing our number of hotels at an even faster pace.
"This, combined with the growth we experienced at the end of 2022, with total revenue exceeding 50% compared to 2019, is a clear indication of the strength and good standing of B&B HOTELS in Iberia.”