Covivio acquires Iberostar in Tenerife

TENERIFE, Spain – Covivio, through its 52.5%-owned subsidiary Covivio Hotels, has acquired from a controlled affiliate of Starwood Capital the 429-room Iberostar Las Dalias hotel in Tenerife on the Canary Islands in Spain for €81 million.

The property has a stabilized yield of 6.75% and is let to Iberostar on a firm triple-net lease until 2041. The fifth largest hotel operator in Spain and owned by the Spanish Fluxa family for 60 years, Iberostar is affiliated with IHG Hotels & Resorts and operates 110 hotels in over 35 countries.

The property features a restaurant, three bars, three swimming pools, a gym, squash and volleyball courts, as well as two meeting rooms for up to 140 people. Built in 1985 and refurbished in 2021, it boasts solid environmental credentials, with a carbon footprint of 18.9kg eqCO2/m²/year in 2023, in line with CRREM targets.

The Canary Islands, Spain’s leading tourist destination with 69.7 million overnight stays in 2023 (20% of the national total) is the only non-seasonal leisure destination in Europe. The main tourist hub had almost 11 million overnight stays in 2023.

The year 2024 marks a turning point for Covivio in the hotel sector, after increasing its stake in its subsidiary Covivio Hotels by 8.7% in the first half of the year (to 52.5%) and finalizing in early December the consolidation of operating and property companies held jointly with AccorInvest.

This is Covivio’s first acquisition of hotel properties since 2020. In line with its ambitions announced at its Capital Markets Day 2024 in Paris at the end of November, Covivio is thus continuing to strengthen its exposure to the hotel sector, particularly in the leisure segment in Southern Europe.