Billionaire property magnates the Reuben brothers have spent around €100m buying one of Venice’s oldest hotels, a vote of confidence in a luxury travel market upended by the pandemic.
The 90,000 square foot Baglioni Hotel Luna, which dates back to the 12th century, is the latest in a string of hotel and retail investments made by David and Simon Reuben since the start of the coronavirus crisis.
They invested around $3.8bn across the US and Europe last year, snapping up assets such as the Surrey Hotel on New York’s Upper East Side and the Corinthia Hotel in Rome.
“We are passionate about high quality hotels and want to support where we can,” Simon Reuben, the younger of the two, told the Financial Times.
The brothers own a wide portfolio of assets through their eponymous holding company. The acquisition of the Baglioni Hotel Luna is their second investment in the Venetian hotel market after they bought the boutique Il Palazzo Experimental in 2017.
Refurbishment works on the property have already begun with the aim of opening the hotel to guests this summer.
Yet tourist hubs such as Venice have been rendered shadows of their pre-crisis selves as lockdowns and international border closures have kept visitors away. Luxury hotels in metropolitan destinations have been particularly hard hit given their reliance on wealthy international travellers.
Analysts and executives across the travel sector expect budget and leisure travel to be the first to rebound.
Even after reopening last June, following the first wave of the pandemic, several Venetian hotels reported occupancy rates as low as 15 per cent despite it being peak season.
Pre-Covid Venice welcomed around 12m visitors each year, according to figures from the Italian Bureau of Statistics. However, arrivals in the city in 2020 were 71 per cent below 2019’s levels, according to an estimate from research firm Statista.
Mr Reubens said he believed “the world will eventually return to a new normality and historic city centres will always attract new residents and visitors”.
Alongside investments in high end hotels in Miami, Las Vegas and Ibiza over the past year, the brothers have also purchased retail assets on Rodeo Drive, Los Angeles, and were part of a joint venture in the senior debt secured against the 28-site private members’ club Soho House.
They were most recently part of a consortium led by Saudi Arabia’s sovereign wealth fund looking to buy Newcastle United football club, their first foray into sport beyond horse and greyhound racing. The £300m takeover fell apart in the summer amid recriminations between the Premier League and the club’s owner, Mike Ashley.