Henderson Park and Hines acquire Crete hotel portfolio
Henderson Park and Hines have acquired a portfolio of five hotels on the popular Greek island of Crete.
The purchase, comprising two separate transactions, marks the joint venture’s second foray into the Greek hotel market, following the acquisition in 2017 of the former Ledra hotel, which was transformed by Hines and Henderson Park into the five-star Grand Hyatt hotel, now one of Athens’ finest and most successful hotels.
The 1,094-room, circa 67,000 sq m portfolio comprises five seafront hotels in key resort locations across the island, as follows:
• Hermes and Coral, two adjacent hotels with 218 and 170 rooms respectively, centrally located in the coastal city of Agios Nikolaos;
• Santa Marina and Apollonia, with 208 and 336 rooms respectively, benefitting from prime seafront locations in Crete’s capital city, Heraklion, which is just 5km from the island’s main international airport and close to world famous archaeological site Knossos;
• a 162-room resort and spa hotel located in Sitia, a coastal town on the west of the island.
All of the hotels have strong track records of occupancy levels and offer uplift through restructuring of the ownership and capital structure, as well as significant potential to create value over the medium and long term through refurbishment, brand repositioning and proactive management at the asset level.
Crete is Greece’s largest island and most established resort destination. The Mediterranean island’s appeal is driven by its longer than average holiday season, running from April through to October, as well as its accessibility with a full ferry schedule and three airports, including the new international airport at Kasteli, which will be able to accommodate all sizes of passenger aircraft.
Henderson Park and Hines will bring their local and international hotel asset management expertise to these latest acquisitions in Crete, having successfully repositioned and enhanced numerous other hotel projects around the world. Y&T Daskalantonakis Knossian Group, a specialist asset manager of upscale and luxury hotels, has also been instructed by the joint venture as local operating partner, responsible for managing the hotels.
Nick Weber, Founding Partner of Henderson Park, says: “While the leisure industry has no doubt been temporarily impacted by the Covid-19 crisis, we are firm believers that it will bounce back. With this transaction we have been able to provide a solution to a distressed situation and gain control of a number of high quality, high-potential assets in a globally leading tourist destination at an attractive entry basis. Government plans to begin reopening Greece are reaffirming our overall investment thesis and we have strong conviction in the significant repositioning opportunities that have been identified to enhance longer term value. We are pleased to be working with Hines on yet another exciting Greek hospitality project where we believe our combined global expertise and institutional approach will give us a distinct competitive advantage in a market, where hotel ownership is surprisingly fragmented and characterised by many local owner-operators.”
Paul Gomopoulos, Senior Manging Director and country head for Greece at Hines, says: “While the headwinds from the global pandemic will clearly have a material impact on the leisure and hospitality sectors, we have confidence in the mid to long term prospects and as such are committed to pursuing further opportunities in this market. We are looking forward to continuing our successful partnership with Henderson Park, which offers a very effective combination of international expertise and local knowledge.”
Finance for the transaction was provided by Piraeus Bank. Hines and Henderson Park were advised by Lambadarios Law Firm.