JV Takes Barcelona Hotel for $529M

BARCELONA-The Netherlands joint venture of Host Hotels & Resorts has bought the Hotel Arts Barcelona for about euro 420.35 million ($529.4 million), including the assumption of about euro 282.35 million ($355.5 million) of debt.

Host Hotels and partners Dutch pension fund Stichting Pensioenfonds ABP and Jasmine Hotels Pte Ltd., an affiliate of real estate investment company GIC Real Estate Pte Ltd., bought the Ritz-Carlton hotel. The hotel, which is located on the shores of the Mediterranean Sea in Barcelona, contains 483 luxury guestrooms, including 28 luxury duplex apartments. The property, which recently underwent a comprehensive guestroom renovation that was completed in June 2006, also features 24,000 sf of meeting space including the largest ballroom in Barcelona, five high-quality restaurants and a full-service spa with eight treatment rooms. The transaction also includes the purchase of an approximately 80,000-sf casino that is leased to a third-party operator.

“We are very pleased to be acquiring the Hotel Arts, one of the finest and most unique hotels in Europe at what we believe will be very attractive yields to the joint venture,” Christopher J. Nassetta, president and chief executive officer, says.

The purchase price for the property is approximately euro 420.35 million ($529.4 million) plus the assumption of about euro 282.35 million ($355.5 million) of debt with an interest rate under 5%. The hotel’s EBITDA for the first 12 months of ownership is forecast to be approximately euro 32 million ($40.29 million). The purchase is subject to customary closing conditions and is expected to close in August.