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Remaining Zinc Hotels portfolio sold for £246m

19 February 2019 by
Remaining Zinc Hotels portfolio sold for £246m

The nine remaining properties of the Zinc Hotels portfolio have been sold out of administration to Vivion Investments for £246m.

The portfolio originally comprised the Hilton London Kensington and nine regional Hilton branded hotels. The 601-bedroom Hilton London Kensington was sold for £261.5m to Cola Holdings last year and was one of the largest single asset hotel sales across Europe in 2018.

The nine regional Hilton hotels have been acquired by a number of special purpose vehicles controlled by Vivion Investments. The properties included Hilton hotels in Croydon; Watford; Nottingham; Leeds city centre; Northampton; York; East Midlands Airport as well as the Hilton hotel and Woodcourt Lodge in Cobham, Surrey; and Hilton Puckrup Hall in Twyning, Tewkesbury (pictured).

All the hotels are operated under occupational lease agreements with a subsidiary of Hilton Worldwide with an initial unexpired term of around 11 years.

Property developer Vincent Tchenguiz's Zinc Hotels bought the hotels in 2002 for £335.7m and leased them back to Hilton, which initially retained a 40% stake in the properties.

In 2006, Hilton sold Tchenguiz the rest of the interest under an agreement that would see the operator lease them until 2029. However, Zinc Hotels fell into administration in February last year.

Rob Stapleton, a director in Savills' hotel team, which marketed the properties, said: "The disposal of the Zinc portfolio is indicative of the unabated appetite for UK hotels, particularly those with attractive lease terms and long-term value enhancement opportunities. The offering included a bond-like income structure whilst the scale of the portfolio attracted significant interest from a broad spectrum of global capital sources. We are delighted that Savills sourced the purchasers for these hotels and to have completed these high-profile transactions on behalf of the joint administrators."

Cola Holdings acquires Kensington Hilton for £260m >>

Nine Hilton hotels for sale after owner's administration >>

Owner of 10 Hilton hotels enters administration >>

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