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InterContinental sells seven European properties

13 July 2006
InterContinental sells seven European properties

InterContinental Hotels Group (IHG) has sold seven European hotels to the Morgan Stanley Real Estate Fund (MSREF).

The €634m (£440m) deal, approximately €80m (£55m) above net book value, is expected to be completed in the third quarter of 2006.

IHG has retained 30-year management contracts for the hotels, with the option of two ten year renewals at IHG's discretion. MSREF has agreed to make investments into the properties of around €60m (£41m).

The deal brings the total number of hotels IHG has sold since separating from Six Continents in April 2003 to 175.

Andrew Cosslett, chief executive of IHG said: "This deal is a significant step for IHG as we near the conclusion of our asset disposal programme."

He added: "IHG is fully focused on its growth target of adding 50,000 to 60,000 rooms to our portfolio on a net and organic basis by the end of 2008."

The portfolio of 2,537 rooms was originally put on the market in January this year.

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By Alix Young

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