Le Meridien on Piccadilly for sale for £90m

31 October 2008 by
Le Meridien on Piccadilly for sale for £90m

The luxury hotel Le Meridien on Piccadilly, London is to be put up for sale for an estimated £90m, it emerged today.

The sale of the 267-room hotel forms part of the Lehman Brothers asset sell-off, and will be managed by the advisory firm Molinaro Koger.

The hotel, which is owned by Starman Hotels, a hotel investment joint venture between Lehman and Starwood Capital, is being sold subject to a management agreement with Starwood Hotels & Resorts, the US operator of the Sheraton, Westin and Méridien brands.

Lehman's involvement with the five-star hotel dates back to 2005, when the Méridien business was sold off in two chunks.
The hotel management and franchising business was acquired by Starwood Hotels, while the owned and leased properties were sold to the newly formed Starman.

Eric Kudlak, Molinaro Koger's managing director for Europe, said the sale of the Piccadilly hotel was not related the collapse of Lehman.

He pointed out that Starman had been gradually selling off assets since well before Lehman's woes came to light.

Kudlak told The Times: "Despite the financial uncertainty, there is a great interest in this property, which is a particularly coveted location."

The Piccadilly hotel reported turnover of £23.7m in 2007, generating a net operating income of £5.1m. Its recent performance has seen occupancy hit 87%, with an average room rate of £213.

Economic turmoil set to slow hotel market growth >>

Starwood inches nearer to Le Meridien deal >>

Lehman Brothers and Starwood to save Le Méridien >>

By Gemma Sharkey

E-mail your comments to Gemma Sharkey here.

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