Sales complete the work of administrators who have recouped some £150m for the beleaguered hotel group formerly owned by Andrew Davis, Janet Harmer reports
Sixteen months after the dramatic collapse of Von Essen Hotels into administration with debts of nearly £300m, the 28 properties formerly operated by the beleaguered company are now all under new ownership.
The final two hotels in the high-profile portfolio – including 26 hotels in the UK, one in France and a development opportunity on an island off the south Wales coastline – have been snapped up by entrepreneur and former Dragons’ Den presenter James Caan.
Hamilton Bradshaw, Caan’s private equity company, has paid £3m for the 22-bedroom Ston Easton Park in Bath (pictured), while the 24-bedroom Sharrow Bay in Cumbria has gone for the knock-down price of £1.5m. Both properties were originally put on the market for £5m each.
It is believed that the dramatically reduced price paid for Sharrow Bay – an iconic property founded by Brian Sack and Francis Coulson in 1949 – was due to its short-leasehold status.
Despite the hotels receiving widespread interest from a range of prospector investors – both individual and corporate – the proceeds from the disposal of the company, founded by the flamboyant entrepreneur Andrew Davis, is believed to have amounted to just £150m. The figure is far short of the initial price tag of £203.25m hoped to have been achieved by administrators Ernst & Young.
While property agents, Christie & Co, would not confirm the price that each hotel was sold for, the figures quoted in the table opposite have come from sources close to the transactions.
Hotel consultant Melvin Gold commented: “The sale of the Von Essen hotels signals that there is currently a good demand for properties, but the achieved sale prices are an indication that the hospitality industry is still finding it hard to raise funding from the banks.”
Most of the hotels are now undergoing different levels of refurbishment, following many years of underinvestment by Von Essen in the fabric of the properties.
One of the major beneficiaries of Von Essen’s woes is Nigel Chapman, who is currently immersed in spending £10m on breathing new life into seven former Von Essen hotels, which he purchased in a joint venture with Patron Capital for less than £30m. They include the four hotels he and his then partner, Nigel Dickinson, sold to Von Essen in early 2006 for nearly £30m – Woolley Grange in Wiltshire, Fowey Hall in Cornwall, Moonfleet Manor in Dorset, and the Ickworth in Suffolk – and are now being run under the Luxury Family Hotels brand.
Meanwhile, Dickinson is himself completing a refurbishment and adding a bistro to another former Von Essen hotel, the 26-bedroom Congham Hall in Norfolk, which he bought this year for about £2.5m.
The most expensive hotel was the 41-bedroom Cliveden in Berkshire, sold for nearly £30m for a long lease from the National Trust to billionaire property-developer brothers Ian and Richard Livingstone.
Alongside the properties now belonging to Luxury Family Hotels, two other hotels have returned to their former owners – Ynyshir Hall in Powys and Lewtrenchard Manor in Devon.
Joan Reen, who with her husband Rob sold Ynyshir Hall to Von Essen in 2006, said the hotel is currently looking “splendid” having carried out a considerable amount of work behind the scenes as well as refurbishing all the public areas in the months since they bought back the property. By the time they have also reconfigured rooms and developed two new suites, resulting in a total of 10 rooms, and created a small spa, they will have spent nearly £1m on improvements.
Meanwhile, two hotels which did not form part of the original Von Essen administration – Hotel Verta in London and Llangoed Hall in Brecon, Powy – have also gone on to be sold to new owners. With another former Von Essen property, Hunstrete House, near Bath, forced to close after being placed into creditors voluntary liquidation, Davis has just one hotel left from an original portfolio of 31 – the five-AA-star, 23-bedroom Forbury in Reading.
By Janet Harmer
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