Travelodge has joined forces with Twenty10 Fund management to launch a £100m development fund to help meet its aim to develop up to 500 new hotels over the next 12 years.
The budget hotel chain plans to open an additional 40,000 rooms in the UK by launching a new hotel on average every eight working days.
By the end of 2020, the group aims to operate 70,000 rooms in around 1,000 hotels, accounting for around 10% of the total accommodation supply in the UK.
"This fund will ensure that we keep our foot firmly on the accelerator pedal in our UK growth drive," said Paul Harvey, managing director of development at Travelodge.
"We are now establishing ourselves as the number one hotel brand in many of the country's largest cities and this new fund will push our growth even further."
The new finance will enable Travelodge to develop five new hotels in London and other major UK cities each year for 12 years, bolstering its presence in city centres. The company recently reached its target of being the largest hotel brand in London and Edinburgh.
The seven-year fund is currently in the process of raising £50m of equity, which will be supplemented by £50m of bank debt. Travelodge will also invest £500,000 in the fund.
The new properties will be leased to Travelodge on 25-35 year leases.
By Janet Harmer
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