Stories
We find the right hotel operator
01 The Opportunity
A hotel in Madrid under family ownership and management sought solutions in the face of an imminent generational change within the owning family. The establishment has 150 rooms within the upscale segment and is located in one of the most fascinating areas of the capital city.
The family business had been involved in the management of the establishment up until then. The market situation had, however, changed, as had the expectations of new generations. This meant that a transformation was under consideration, including the repositioning of the hotel product.
02 The Solution
In Cushman & Wakefield we have the necessary experience in advisory services and in partnering owners of hotel assets in the search for national and international brands. This may prove the trigger for change or the repositioning of the hotel product, also enabling the owner to achieve profitability from the business under the model that best fits their criteria in terms of risk profile and operational control.
This option was chosen in this particular case and two alternatives were put to the family, with the participation of hotel chains that we consider would be best able to fit in and understand the scale and strategy of the project whilst having greater empathy with the owners.
Following an evaluation of the various possible business models in line with the desired risk profile and degree of control of the asset, and following an analysis of the options in terms of potential operators, the family opted for a management contract with an international brand providing capex for the repositioning of the hotel product. Cushman & Wakefield advised the client throughout the management and negotiating process, up to the closure of the agreement with the hotel operator
03 The Result
Following the repositioning of the asset, the hotel achieved a 36% increase in turnover in comparison with historic figures. This enabled the family owners to grow profitability and returns in the face of a generational change that had raised serious doubts in terms of viability and management. Additionally, and as a result of the transaction, a hotel asset that run the risk of becoming obsolete within a very competitive environment has now grown in value.
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