Dutch real estate company Redevco and Swiss Finance & Property have formed a joint venture (JV) aimed at acquiring hotel assets in Spain and Portugal, with a focus on meeting the needs of millennial travellers.
The JV comes after the first closing of a fund managed by SFP that has indirectly acquired the majority stake in Redevco's Next Gen Stays, which includes a seed portfolio of six properties in the Iberian Peninsula, including Lisbon, Porto, Bilbao, Malaga, and Seville.
The collaboration is part of a strategic move to capitalise on the growing demand for flexible, sustainable, and community-driven accommodation options.
The selected assets will be leased to professional, tech-savvy hotel operators and redeveloped to offer authentic, sustainable, and competitively priced accommodations.
This initiative is designed to address the current gap in the hospitality sector, which often overlooks the preferences of younger travellers for more adaptable and eco-conscious lodging options, the companies stated.
Redevco investment director Hannah Evans said: “Our value-add Next Gen Stays strategy is an excellent example of Redevco’s focus on repurposing assets to create vibrant places in urban locations.
“By acquiring and redeveloping strategically located and under-exploited real estate with local character, we create an attractive investment product and make cities more sustainable.”
The strategy also seeks to achieve a net levered internal rate of return of more than 15% in a five-year time frame and aims to amass a portfolio valued at nearly €300m.
Redevco's expertise in locating valuable properties in prime urban locations is key to attracting operators who prioritise room-driven revenues.
These operators also stand to gain from the venture's low fixed costs and competitive average daily rates.
The SFP-managed fund intends to expand its share in the joint venture through capital injections to secure additional assets.
Swiss Finance & Property UK CEO Philipp Braunwalder said: “Working alongside Redevco on yet another project tailored for the younger demographic has been both fulfilling and inspiring. We are excited to venture into the hospitality sector with a trusted partner by our side.
“At SFP, our commitment to providing innovative real estate solutions for future generations remains steadfast, while prioritising community enrichment and sustainable development.”
Last month in Spain, Tivoli Hotels & Resorts, a division of Minor International, inaugurated the Tivoli La Caleta Tenerife Resort, marking the brand's debut in the country.
