Travelodge is to partner the Arcadia Group in the development of a 96-bedroom hotel above a Topshop in the centre of Edinburgh.
The hotel in the Scottish capital is just one of 22 new Travelodge hotels, totalling 1,198 bedrooms, at a combined investment value of £165m.
In Edinburgh, Arcadia will forward fund the £10m refurbishment costs of the former office and storage space over four floors, above the city's largest Topshop store on Princes Street. Due to open in summer 2012, the hotel will be operated by Travelodge on a 35-year lease from Arcadia.
The other new Travelodge properties that the group has exchanged on include five London locations in Walthamstow, Enfield, Bethnal Green, Sutton and Southgate. Elsewhere, there will be new hotels in Edinburgh Queen Street, Eastleigh, Loughborough, Sittingbourne, Bedford, Gatwick Airport, Darlington, Altrincham, Malvern, Aylesbury, Newquay, Woking, Glasgow Airport, Hemel Hempstead, King's Lynn and Barcelona.
The company has already opened 18 hotels in the first half of 2011 and is currently in the process of building 43 hotels (4,280 rooms). Twenty one of these properties are due to open before the end of this year.
The new openings will boost Travelodge's portfolio to 540 hotels and 39,957 rooms, and will create 1,300 new jobs across the country.
Chief executive of Travelodge Guy Parsons said the first six months of 2011 had been the strongest in the company's history. "We are not just exchanging contracts but most importantly finance is being secured up front, to enable our developers to start on-site immediately," he said.
"Everybody knows how difficult it is to obtain bank funding at the moment, so to have financed so many new schemes must be one of the biggest success stories of the UK property industry".
"Arcadia forward funding our new hotel in one of the most prestigious locations in Edinburgh just demonstrates how flexible the Travelodge development model is. Given the lack of new development sites in central Edinburgh this really is one of the most prominent sites left in the city and we are delighted to have secured it."
Over the past five years Travelodge has focused on city centre growth to rebalance its portfolio away from roadside locations. Today 18% of Travelodge rooms are in London, 62% of rooms are in major cities and towns, with the remaining 20% of rooms located at major motorways and roadside locations.
By Janet Harmer
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