A dual hotel scheme comprising 620 bedrooms is to be developed in London's Paddington after investment business M&G acquired a long-leasehold on a £203m site.
Whitbread will open a 373-bedroom Premier Inn, alongside Staycity's premium Wilde aparthotel brand featuring 247 studios and one-bedroom units.
The hotels will each be operated - alongside a 27,000 sqft education facility and an open space - under a 30-year lease on five yearly inflation-linked rent.
The capital for the scheme is provided by the £4.1b M&G Secured Property Income Fund, while the construction will be undertaken by development consortium, Concierge 3 (a joint venture partnership between the Pickstock Group, Staycity and BSW Land & Property).
This is the fund's fifth transaction with Whitbread as a tenant, following a £100m deal to develop a 339-room Hub by Premier Inn hotel in Westminster, adding to the existing portfolio of Premier Inn hotels at Gatwick Airport North Terminal, Holborn and Wandsworth.
Jonathan Langdon, acquisition manager (central London) for Whitbread, said: "We've been exploring opportunities to invest in Paddington for some time now and are very excited at the prospect of gaining a presence for Premier Inn there. It's a fantastic development in one of London's most vibrant and well-connected areas and the hotel adds another quality zone-one location to our growing London portfolio."
Tom Walsh, chief executive and co-founder of Staycity, added: "We are delighted to be part of this exciting development opportunity. Paddington Station is London's gateway to the west and is just 15 minutes from Heathrow Airport. As well as being a burgeoning business area, leisure visitors can enjoy two royal parks within walking distance, the picturesque Little Venice and great links to London's Notting Hill and the West End."Get The Caterer every week on your smartphone, tablet, or even in good old-fashioned hard copy (or all three!).