ActivumSG has sold the 118-room Palacio Solecio hotel in Malaga for €51 million to an undisclosed buyer.
Originally an 18th century Andalusian palace, the historic site had fallen into severe disrepair before being acquired by Activum SG Iberia Fund I for €8 million.
Together with local asset and development management company Tech-Stone Development Services, ActivumSG undertook an extensive and complex restoration process to revitalise the palace and bring it into a state fit for modern-day, full-service luxury hospitality use.
The restoration retained the building’s distinctive architecture, with historical features including the original staircase and a grand facade.
During a second phase of redevelopment, ActivumSG and Tech-Stone consolidated and developed three additional abandoned plots of land adjacent to the original site. The extension created 50 rooms, a rooftop bar and swimming pool with views over Malaga’s city centre. The original building opened with 68 rooms in 2019 and the second phase opened in 2023.
Totalling over 87,000 square feet, Palacio Solecio is in Malaga’s historic Old Town, on the doorstep of The Picasso Museum and a 10-minute walk from the seafront. The 118-key asset is currently operated by Marugal Distinctive Hotel Management under a hotel management agreement.
The announcement underlines the increased demand for upscale and luxury hospitality real estate in Spanish cities. According to CBRE, the country is the most preferred destination in Europe for hospitality investment among real estate investors.
Saul Goldstein, founder and CEO of ActivumSG, said: “This project was a classic ActivumSG investment where we were able to acquire a great site and add value. Here we leveraged our vertically integrated capabilities and revitalised a historic site to create a landmark hotel in one of Spain’s most exciting destinations. Given the slower transactional landscape, this sale demonstrates the clear appetite among investors for high-quality, well-located hospitality assets.”
Ashurst acted as legal advisor to the transaction and real estate consultants JLL and Knight Frank acted as commercial advisors.
(Updated on 13 May to correct name of the firm in the headline).