Lanesborough £120m price tag is ‘too high'

06 September 2001 by
Lanesborough £120m price tag is ‘too high'

Industry analysts are predicting that the sale of London's Lanesborough hotel will fall through at the last minute.

The sale of the 95-bedroom hotel on Hyde Park Corner was expected to be the first of several high-profile London hotels on the market. But analysts believe the £120m asking price is too high.

The owner, the Abu Dhabi Investment Authority, the investment arm of one of the United Arab Emirates, put the hotel on the market at the beginning of the year. The prospective buyer, Syrian-born British investor Simon Halabi, has been in negotiations since March.

The hotel is operated by Rosewood Hotels and Resorts and general manager Geoffrey Gelardi said he fully expected Halabi to take over the freehold.

But one source close to the deal said that the downturn in hotel performance in the capital meant Halabi would find it extremely difficult to fund his purchase at its £120m valuation.

The Abu Dhabi Investment Authority is under no pressure to sell. Analysts predict that if a serious attempt is made to lower the price, the owner will back out.

Chris Rouse, director of Insignia Hotel Partners, said: "There is still uncertainty in the market about the shape of trading for the rest of the year. Uncertainty inhibits people from making investment decisions.

"The resurgence of foot-and-mouth is not helping. Apart from the Forte disposals, there have been almost no major transactions in London this year. There is a wait-and-see attitude."

by Ben Walker

Source: Caterer & Hotelkeeper magazine, 6-12 September 2001

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