Sierra and PGIM invest over €60 million in a luxury resort in Algarve, with construction set to begin in Q1 2025. Discover the details.

In a significant move within the realm of luxury real estate, Sonae Sierra, in collaboration with PGIM Real Estate, has unveiled plans for a lavish resort development in the picturesque Algarve region of Portugal. This ambitious project, which marks the second investment stemming from their joint venture initiated in 2024, entails an impressive financial commitment exceeding 60 million euros. Construction is slated to commence in the first quarter of 2025, setting the stage for a remarkable addition to the Algarve’s hospitality landscape.

The forthcoming resort, strategically situated in Meia Praia, Lagos, will feature a total of 158 units, encompassing both hotel accommodations and residential apartments. This endeavor follows the successful acquisition of the Cénica Porto Hotel, Curio Collection by Hilton, located in the heart of Porto, underscoring the joint venture’s commitment to enhancing Portugal’s luxury hospitality offerings.

With a gross construction area of approximately 17,000 square meters, the resort promises to deliver breathtaking panoramic ocean views, catering to a diverse clientele that includes couples, families, and solo travelers. Future amenities are poised to include both indoor and outdoor swimming pools, a state-of-the-art spa, and a selection of sophisticated dining establishments, all designed to provide an unparalleled guest experience.

The operational expertise of Iberian Hospitality Solutions (IHSP) will play a pivotal role in ensuring the project’s success, leveraging their extensive experience in hotel management to maximize asset value and operational excellence. The joint venture aims for a target Gross Asset Value (GAV) of €200 million, focusing on the acquisition of sizable hotels in established destinations while implementing strategies that foster value creation.

This investment aligns with PGIM Real Estate’s broader value-add strategy within the European market, reinforcing the region’s appeal as a prime destination for luxury tourism and real estate development. As the Algarve continues to attract discerning travelers, this new resort is poised to become a hallmark of opulence and sophistication, further solidifying Portugal’s reputation as a premier destination for luxury hospitality.