Property developer Vincent Tchenguiz’s hotel business, which owns 10 properties operated by Hilton, has entered administration.
AlixPartners has been appointed to manage the administration of Zinc Hotels (Holdings) Ltd.
Tchenguiz bought the hotels in 2002 for £335.7m and leased them back to Hilton, which initially retained a 40% stake in the properties. In 2006, Hilton sold Tchenguiz the rest of the interest under an agreement that would see the operator lease them until 2029.
The portfolio represents 2,400 rooms. The largest property is the 603-room Kensington Hilton; The others are located in Cobham, Croydon, East Midlands airport, Leeds, Northampton, Nottingham, Tewkesbury and Watford.
Tchenguiz had instructed agents to sell off the portfolio last year, but a sale was not agreed.
The Times has reported that Tchenguiz is pursuing legal action against Hilton accusing the operator of trying to wriggle out of the leases. A pre-action letter is said to have been sent on Friday.
A spokesperson for Hilton said: “We have been informed of the appointment of AlixPartners as administrators for Zinc Hotels (Holdings) Limited and a further 24 companies within the Zinc Hotels group, taking control of 10 Hilton branded hotels in the UK. These hotels operate under a lease structure, the terms of which are unaffected by the change. The hotels continue to operate and welcome guests as usual.
“We are unable to comment on pending litigation.”
Vincent Tchenguiz appoints agents to sell off £600m Hilton portfolio>>
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