Dalata Hotel Group, Ireland's largest hotel operator, has agreed the sale and leaseback of the Hotel La Tour in Birmingham (HLTB) for £30m with real estate investment company Deka Immobilien.
On 21 July 2017, Dalata announced it had acquired the entire issued share capital of HLTB for £31m. Dalata will now operate the hotel on a new FRI (fully repairing and insuring) lease for a 35-year term. The agreed initial rent for the property is £1.6m per annum and will be subject to five yearly rent reviews, index-linked to the Retail Price Index.
The proceeds of the sale will be will be used to reduce net debt arising from the hotel acquisition.
Newly built in 2012, the hotel has 174 bedrooms, a restaurant and bar, as well as extensive conference and meeting facilities. The hotel will be rebranded as a Clayton hotel in the final quarter of this year.
Shane Casserly, head of strategy and development, said: "We are delighted to announce the sale and leaseback of Hotel La Tour in Birmingham, continuing our successful relationship with Deka. The transaction, another milestone in the growth of our UK portfolio, is consistent with our stated strategy of growing in the UK primarily through operating leases."
Dalata has a portfolio of 37 hotels, 24 of which are owned by Dalata, nine are operated under lease agreements, and four under management agreements. The group announced earlier this year that it plans to focus on UK expansion following strong increases in revenue and profit.
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