InterContinental plans massive hotels sell-off

InterContinental is to sell up to a quarter of its hotel assets, the hotel giant has announced.

The company, which published its preliminary results for the 12 months to 31 December 2003 late last week, said it planned to sell between £800m and £1b of its hotels as part of its disposal programme.

The group currently owns about 170 hotels across the globe with an asset value of £3.7b.

Trophy assets such as the InterContinental hotel on London's Hyde Park Corner and the Barclay in New York City are unlikely to be sold, however.

InterContinental said the sales would be across all of its brands, which include Holiday Inn and Crowne Plaza, and across all the regions it operates in.

Over the past year the group has sold 20 hotels, raising net proceeds of more than £250m. Most recently it has sold its Central Park South hotel in New York for $63.2m (£35m) to property company Anbau Enterprises, which will convert the hotel into residential apartments.

InterContinental has also just sold its 56% stake in the 303-bedroom Midland hotel in Manchester to hotel group Paramount for £36m, and put three UK Holiday Inns and the 195-bedroom George InterContinental hotel in Edinburgh up for sale with combined price tags of about £46.5m.

In the year to 31 December 2003, turnover across InterContinental's 3,400 hotels fell by 3.3% to £1.49b, with operating profit dropping by 16.3% to £200m. Despite the declines, chief executive Richard North said results were "sound" and that there were some signs of improvement.

"We have for some time been cautious when commenting on current trading," he said. "However, trading over the past six months now gives us some confidence to say that we believe conditions are improving steadily in both the Americas and the UK."

Intercontinental results