Lucentum Hotel in Alicante Faces Sale As Millennium Hospitality Real Estate Seeks a Buyer
In Alicante, the Lucentum Hotel is being prepared for sale by Millennium Hospitality Real Estate, the listed investment company that acquired the property in 2018. The firm has informed its BME auditor of the plan to divest from the asset and has commissioned CBRE to conduct a market assessment. The announcement follows an initial round of non-binding offers from potential buyers, as stated in the company’s first-term management report to the securities market regulator. These early expressions of interest have not yet translated into firm bids.
The Lucentum Hotel sits in the heart of Alicante, directly opposite the Central Market. It comprises 169 rooms and is operated by Eurostars, a brand within the Hotusa Group, under a lease agreement that requires the building owners to receive a fixed rent through 2025. From that point onward, the contract provides for a fixed rent plus a variable component, in line with the accompanying documents. The latest annex to the 2021 agreement allows for a lease extension to 2040, contingent on meeting certain economic conditions. In hotel real estate, it is common for the property owner to differ from the operator, with management usually handled by private hotel chains. Ownership changes typically do not disrupt hotel operations. [Source: financial disclosures, market filings, 2023]
Although the selling price remains undisclosed, Millennium values the hotel’s gross value at 32.3 million euros on its balance sheet, before any debt deductions. The stated figure reflects the company’s current accounting assessment of the asset. [Source: Millennium Hospitality Real Estate annual report, 2023]
From Bank Headquarters to a Hotel
The building at 11 Alfonso el Sabio Boulevard began as the Bank of Alicante headquarters. It later passed into the hands of BBVA and was sold to the Valencian construction group Garcia Ojeda after a decision by the then council leadership. The council had proposed a conference palace in Benacantil, prompting the new owner to convert the former bank headquarters into a hotel to capitalize on local infrastructure improvements. The conference center project never came to fruition; economic downturns led to Garcia Ojeda’s bankruptcy and the Hesperia-run hotel’s closure in 2010. The Valencia group retained ownership, and the establishment reopened in 2011 under Eurostars management. The property’s debt eventually moved to Sareb and was later sold to Cerberus, a North American fund. [Source: city archives and corporate filings, 2010-2013]
Millennium acquired the hotel in 2018 through a three-pronged operation designed to eliminate approximately 14 million euros of debt at that time. The sale now aims to identify a buyer capable of delivering a favorable return on the investment while maintaining stable operations for the property. [Source: company press release, 2018]
Hotels in Alicante Province Start the Month at 85% Occupancy and Seek to Maintain Pre-Pandemic Rates
Under the leadership of Madrid-born Javier Ilan, Millennium Hospitality Real Estate, with 49.72% ownership by the Castlelake fund, and notable shareholders including former Inditex CEO Jose Maria Castellano, manages a portfolio of 13 hotels. In addition to locations in Madrid, Bilbao, Seville, San Sebastian, Cordoba, and Cadiz, Alicante also features in its portfolio, carrying a gross asset value of 632.1 million euros. In the first half of the year, the portfolio generated earnings of 5.5 million euros. The company has positioned itself to leverage market demand as it recovers from recent disruptions, aligning pricing and occupancy with broader regional trends. [Source: corporate disclosures, 2024]