Hotel Transaction Mexico

Casa Grande Hotels in Chihuahua and Delicias Sold to Fibra Inn

Deutsche Bank Mexico, S.A., Banking institution, Trust Division F/1616 or Fibra Inn (BMV:FINN13) , a Mexican real estate investment trust specializing in the hotel industry serving the business traveler, announced that it acquired two Casa Grande hotels located in Chihuahua and Delicias, with a total of 204 rooms.
Hotel Casa Grande Chihuahua
Hotel Casa Grande Chihuahua

Fibra Inn Deutsche Bank Mexico, S.A., Banking institution, Trust Division F/1616 or Fibra Inn (BMV:FINN13) , a Mexican real estate investment trust specializing in the hotel industry serving the business traveler, announced that it acquired two Casa Grande hotels located in Chihuahua and Delicias, with a total of 204 rooms.

The acquisition price for the Chihuahua hotel was Ps. 105.5 million, excluding Ps. 9.2 million for taxes and acquisition expenses, and Ps. 10.5 million for the re-branding to Wyndham Garden; the projected cap rate for 2015 is 10.0%. The amount paid for the Delicias hotel was 71.3 million, excluding Ps. 6.5 million for taxes and acquisition expenses, and the projected cap rate for 2015 is 11.3%. The total payment was made using funds from the recent CBFI issuance.

Fibra Inn considers that the location of these hotels is key, as they will diversify its presence in new cities that have significant economic vitality. Both hotels are in the full service segment and will be operated by Fibra Inn.

The Casa Grande Chihuahua hotel has 115 rooms and will be rebranded to Wyndham Garden. Its cumulative operating indicators from January to November 2014 reported occupancy of 63.1%, an average daily rate of Ps. 787.8, and Revenue per Available Room equal to Ps. 497.3.

The Casa Grande Delicias hotel has 89 rooms. Its cumulative operating indicators from January to November 2014 reported occupancy of 55.1%, an average daily rate of Ps. 777.3, and Revenue per Available Room equal to Ps. 440.5.

With this acquisition, Fibra Inn has a portfolio of 31 hotels plus three under development, with a total of 5,718 rooms; 645 of these are currently under construction.

Hotel Casa Grande Chihuahua
Av. Tecnológico 4702, Col. Las Granjas, Chihuahua, Chihuahua, 31160.

The business fundamentals for the acquisition of this hotel are the following:

  • Market: Chihuahua is a consolidated market with a dynamic and diverse industry and is one of the most important cities in Mexico in terms of economic activity.
  • Industry: The city has a vast number of industrial parks and an important presence of the aerospace sector.
  • Demand: An important portion of demand for this hotel is driven by companies in various sectors, including: Honeywell Aerospace, Textron, Visteon Corporation, Fokker Aerospace, Delphi, Ford, Interceramic, Cementos Chihuahua, Grupo Bafar and American Industries, among others.
  • Positioning: The hotel has a strong positioning and presence in the city, which has contributed to its positive performance throughout the years.
  • Location: The hotel is located in a premium area, near 7 industrial parks, the city’s business district, and the Autonomous University of Chihuahua.
  • Expansion Capacity: The hotel has excess land equivalent to 12,876 m2 with capacity for expansion, or an additional hotel development. Similarly, the property has office space, which contributes to its profitability; as such income was not included in the valuation conducted for the acquisition.
Hotel Casa Grande Delicias
Av. 6 Oriente 601, Col. Centro, Delicias, Chihuahua, 33000

The business fundamentals for the acquisition of this hotel are the following:

  • Market: Growing manufacturing and agricultural industries. Delicias is the fourth most important city in the state and has demonstrated important industrial growth in the past few years.
  • Industry: The pharmaceutical, medical, rubber and textile industries have a strong presence in the city.
  • Demand: The demand of this location is mainly driven by pharmaceutical representatives from Bayer, Rimsa and Sanofi.
  • Positioning: This is the most-recognized hotel in the city, and as such the brand will remain unchanged, by means of a brand licensing agreement.
  • Location: The hotel is located in the heart of the city, near the main shopping centers, financial and government institutions.
About the Company

Fibra Inn is a Mexican trust formed primarily to acquire, develop, operate and rent a broad range of hotel properties in Mexico. Headquartered in Monterrey, Fibra Inn has a portfolio of high-quality real estate properties aimed at the business traveler and that are geographically diversified throughout Mexican territory. The Company has signed Franchise Agreements with IHG to operate its global brands, including: Holiday Inn, Holiday Inn Express, Holiday Inn & Suites, Holiday Inn Express & Suites and Crowne Plaza; with Wyndham Hotel Group to operate its global brands Wyndham Garden and Microtel Inn & Suites by Wyndham. Additionally, it has licensing agreements and brand usage agreements with Hilton to operate its brand Hampton Inn by Hilton and with Starwood Hotels & Resorts Worldwide to operate the Aloft brand. The Company has properties that operate with domestic brands like Camino Real and Casa Grande. Additionally, Fibra Inn has agreements with IHG, Marriott International, Wyndham Hotel Group and Hoteles City Express for development of properties. These hotels enjoy some of the industry’s top loyalty programs. Fibra Inn recently listed its Real Estate Certificates (Certificados Bursátiles Fiduciarios Inmobiliarios or “CBFIs”) on the Mexican Stock Exchange and trades under the ticker symbol “FINN13.”



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