The number of mansions and hotels up for auction has increased

The dramatic situation experienced by the hotel and catering industry has taken a particular toll on businesses focused on events. Many of these properties are now on sale, and its number is especially high in Barcelona, where they have become the way to get hold of hotel establishments whose reopening is not possible due to municipal regulations.

The more than year-long hiatus in the tourism sector has left the waters choppy, but investors remain optimistic about the future in the long-term. According to Cushman & Wakefield Hospitality's Europe-wide survey, 40% of respondents intend to buy more hotel properties, while 29% plan to continue their investment activity just like before the pandemic. Only 21% of investors plan to reduce the hotel acquisition.

In 2020, possibly the worst year for tourism in history, Spain recorded a very significant hotel investment figure of close to €1 billion.

Spain is one of the countries in Europe with the largest number of rural properties, many of which also include a country house, making them the perfect target for anyone who wants to add a rural asset to his or her estate. Many of these mansions also have a farm and livestock, which helps cover costs and generates profits.

For those who do not enjoy farms, events have been one of the ways of making profit for years. The year and a half break that has happened to social life has meant that some of these businesses have faced bankruptcy, which has led to a boom in the sale of this type of property on auction platforms.

This is the case of the company specialising in the liquidation of assets from bankruptcy proceedings, Asemar Concursal, which has published on its platform the upcoming auction of a rustic property in the town of Viladecavalls, Terrassa, which goes on sale with a minimum price of 3,187,334.53 and is valued at 4,249,779.37 euro. It has a farmhouse of 54,686 m2, in perfect condition, designed for weddings or large events due to its facilities.

Another example would be Finca Masía Bach, with 48,400 square metres, of which 23,446 are occupied by the different buildings and warehouses that were once used for the production of red, white and rosé wines, although it is also prepared for the production of cava. The total constructed area of the farmhouse is 3.000 m2. Price to be negotiated.

In total, in the first six months of 2021, hotel sale and purchase transactions have reached 225 million euros in Catalonia, of which more than 200 million have been transactions based in Barcelona city, according to the latest data from Colliers International Spain.

"Those who owned a hotel in Barcelona in recent years had a treasure that was unimaginable to part with. Tourism and income were growing steadily and the moratorium implemented since 2015 by Ada Colau's city council of not opening/building more hotel establishments meant that owners took them as a fortress that was impossible to let go. But the tourism crisis caused by the pandemic has suffocated many of them and they have had no choice but to put them on sale.

For this reason, Barcelona has taken first place in the ranking of the most desirable cities to invest in the hotel sector, ahead of historic places such as London, Paris and Amsterdam, according to the Cushman & Wakefield survey.

The need to sell and the appetite to buy should "meet" in the latter part of the year, as Colliers' hotel investment report says. "There is a high level of consensus and conviction among the investment community that, in the medium term, tourism demand will recover and the effects of Covid-19 will allow hotels to be acquired at more reasonable price levels than those in 2019. Despite the above, it will still be a few months before transactions begin to materialise in a significant way. Not only because hotel owners will still have to wait a little while to see what the prospects for Easter and the summer season are, but also because financial institutions are still keeping the tap of financing for acquisitions closed," say the sector experts in the report.

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