Hotei, the hotel-focused real estate investment trust, reported a 78% drop in net profit for the first half of the year, falling to €6.4 million from €29.4 million in the same period of 2025, according to data submitted to BME. This significant decline reflects the company’s strategic shift and ongoing financial adjustments.
This comes amid a takeover bid from Painwick Capital and the €105 million sale of Hotel Nômade Madrid to GS Bacares Iberia, majority-owned by Nômade Partners. The takeover bid and asset sale highlight the dynamic changes within the company’s ownership and portfolio structure.
Portfolio Shift and Asset Sales Drive Changes
The company attributed the decline to a portfolio shift towards luxury and ultra-luxury properties, the sale of non-core assets like the Meliá & Radisson Collection in Bilbao for €105 million, and lower structural costs and debt levels. This strategic repositioning aims to enhance long-term profitability by focusing on higher-margin segments of the hospitality market. The sale of non-core assets not only generates immediate capital but also allows Hotei to concentrate resources on its core luxury portfolio. Additionally, the reduction in structural costs and debt levels reflects a disciplined approach to financial management, aimed at improving overall financial health.
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Hotei emphasized that these results are not comparable to those of 2025 due to these significant changes.
Financial Metrics Reflect Transition
Revenue fell 18% to €10.98 million, while EBITDA dropped 39% to €4.96 million. The gross asset value decreased to €477.1 million, and the net loan-to-value ratio improved to 19.6%. These metrics indicate a deliberate reduction in scale to prioritize quality over quantity, with a focus on high-value assets and financial stability. The improvement in the loan-to-value ratio, in particular, signifies a stronger balance sheet and reduced financial risk.
Despite these declines, revenue per available room (RevPAR) increased by 15.6% to €310, driven by a 9.6 percentage point rise in occupancy to 71.8%. This growth in RevPAR shows the success of Hotei’s strategy to target luxury markets, where higher occupancy rates and premium pricing can offset reduced portfolio size. The stable average daily rate of €432 further demonstrates the company’s ability to maintain pricing power in a competitive market.
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The average daily rate remained stable at €432. By the end of June, the share price had risen 60% since December 2024, reaching €3, resulting in a market capitalization of €381 million. This share price increase reflects investor confidence in Hotei’s strategic direction and its potential for future growth. The market capitalization growth also highlights the company’s enhanced valuation despite the short-term financial adjustments.
Key events in the first half included the sale of the Meliá Bilbao in March and the Radisson Collection Bilbao in May, both contributing to the €105 million total. The sale of Hotel Nômade Madrid was finalized in June, along with Painwick Capital’s voluntary takeover offer to all shareholders. These transactions mark significant milestones in Hotei’s strategic realignment, providing both financial flexibility and a clearer focus on its luxury segment. The takeover offer from Painwick Capital adds another layer of strategic complexity, potentially leading to further changes in the company’s ownership and operational direction.