Six UK hotels in first sealed bid auction
AT exactly 5pm on 28 July the ownership of 14 hotels throughout England, Austria, Belgium, France, Portugal and Spain will be decided.
The hotels, including the Carlton in Bournemouth and the Holiday Inn in Cambridge, are all being offered for sale in a unique sealed bid auction (a form of secret tender) organised by the London office of Kennedy-Wilson International, a California-based real estate agency which specialises in sealed bid sales and auction marketing.
The auction of 14 hotels - including six in England and four resort hotels in Spain - is the first of its type to be held in this country. A similar type of sale, but including US hotels, was marketed in the UK last year by Jones Lang Wootton in partnership with Kennedy-Wilson.
Aubrey Glaser, managing director of Europe at Kennedy-Wilson, told Caterer last week that a sealed bid sale levelled the playing field for all potential purchasers and created a global market for a property.
"When a hotel vendor sells a hotel through a broker, he is never sure if he got the right price for his property or if the right people were reached by the broker. We say, forget that and put the hotel into a bigger offering with a minimum reserve price," he said.
Because the sale includes 14 significant hotels, the agency can afford to market it around the world. A brochure is sent out to potential investors in Europe, the Far and Middle East and the USA. This is backed up with international advertising and telemarketing.
Once a potential bidder has expressed serious interest, a "due diligence book" which costs $50 (£33) is couriered to them. The book, running to hundreds of pages, includes trading details, engineering reports, legal issues and licensing and leasing concerns.
The book means that a potential buyer in Hong Kong should know as much about the hotel as a UK bidder. Property visits would then follow.
For the sale of these 14 properties, the bid forms and deposits have to be at Kennedy-Wilson's office by 5pm on 28 July. Mr Glaser said the specific deadline often acted as a catalyst for action by potential bidders.
Apart from the 70-bedroom Carlton (reserve of £3.9m) which has been in receivership for two years, and the 199-bedroom Holiday Inn (£12.2m) which is managed under contract by Holiday Inn Worldwide, the other UK hotels are the 196-bedroom Ramada Hotel, Reading (£7.1m); the Park International Hotel, Birmingham (£2.5m), which needs a major renovation; the Marine Hotel at Salcombe, Devon (£3.5m); and the Miramar Hotel, Bournemouth (£1.7m).
