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We are excited to present a new project in Portugal. This time, we return to Porto with Caler Real Estate Advisory to develop 57 tourist apartments. The project will be open for investment next Thursday, November 21 at 4:00 p.m. (UTC+1).
The Julio Dinis project involves acquiring a building to demolish its interior and develop and sell a complex of 57 tourist apartments along with two commercial units. The complex will be operated by an international manager, Líbere Hospitality Group, under a fixed lease agreement.
The asset covers 2,600 square meters distributed over nine above-ground floors. One of its strong points is its location. Situated in the Massarelos neighborhood, on Julio Dinis Street, the property is in the center of Porto, Portugal’s second-largest city. The city, with a metropolitan area of over 2 million residents, is an international tourist hub, with a historic center designated as a World Heritage Site.
As for the developer, they are well known to Urbanitae, as we collaborated with them on Barao Forrester. Caler Advisory & Asset Management has extensive experience managing and structuring hotel projects in Spain and Portugal. They currently manage assets worth 300 million euros and have undertaken projects totaling 70 million euros. Julio Dinis is their fourth project in Porto.
Approved building permit
It is worth noting that the necessary building permit for the renovation of the property is already in place. Additionally, the project has the approval of the City Council and an authorized change to a tourism-focused use.
Another strength of the Julio Dinis project is the tenant for the complex. Líbere Hospitality Group is an international operator of tourist apartments and a market leader in Spain, managing and developing over 1,400 units across 45 properties in Spain and Portugal.
The lease agreement with Líbere is a fixed-term lease lasting 25 years, with 15 years guaranteed. Additionally, Líbere will provide either a bank guarantee equivalent to 12 months of rent or a deposit covering 12 months of rent. The contract will come into effect once the renovation and transformation of the property are completed and includes a one-month grace period from opening.
The project follows a capital gains strategy, involving an alliance with the developer to cover the acquisition of the asset and the costs of adaptation, management, and sale. In total, Urbanitae investors will contribute 4,845,000 euros, representing a 75% stake. The developer and their partners will contribute the remaining 25%.
In this video, Caler Advisory and our Real Estate Director, Sergio Arana, explain the details of the operation.
Returns in 20-24 months
As with all capital gains projects, the regulator does not allow us to share an estimated return for this project. However, you can calculate it using the information provided in the project sheet:
(Estimated Income – Estimated Costs) / Total Equity
The estimated project duration is between 20 and 24 months. According to the business plan, the asset acquisition will close in the fourth quarter of 2024. The renovation work is expected to be completed in the second quarter of 2026, at which point the property will be considered for sale if market conditions are favorable. At this time, Líbere’s management will also begin, and the first dividend payment, which will be quarterly, will commence. The project is expected to conclude, and profits will be distributed in the third or fourth quarter of 2026.
Do you have questions? Feel free to ask them during the webinar we will hold with the developer on November 19 at 5:00 p.m. (UTC+1). You can also reach us at contacto@urbanitae.com or by phone at (+34) 911 23 25 22. We would be delighted to assist you.
