Luxury Family Hotels (LFH) is to sell the Elms, one of seven properties it acquired following the Von Essen administration in 2011.
Located in 10 acres of grounds in Abberley, Worcestershire, the 23-bedroom Queen Anne mansion house has been put on the market for £5m.
Nigel Chapman (pictured), founder and chief executive of LFH, said although the Elms is a "beautiful" property with a "great" spa, it is not in the right geographical location for its family market.
"Most of our guests come from London and the south east and Worcestershire is not really on their radar. "A new owner will be able to capitalise on the Elm's potential as a wonderful wedding hotel."
"We would like to add more hotels, in the right location, to the portfolio, but for the time being it makes sense that we concentrate on the hotels where the demand is greatest," said Chapman. "We intend to expand some of the hotels, such as New Park Manor, which could potentially double in size."
The Elms is being marketed for sale by Savills.